8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported):  June 18, 2008 (June 12, 2008)

Vantage Drilling Company

(Exact name of registrant as specified in its charter)

Cayman Islands (State or Other Jurisdiction of Incorporation)	1-34094 (Commission File Number)	(IRS Employer Identification No.)
777 Post Oak Boulevard, Suite 610 Houston, TX   (Address of principal executive offices)		77056 (Zip Code)

(281) 404-4700
(Registrant’s telephone number, including area code)

(Not Applicable)
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.01.  Completion of Acquisition or Disposition of Assets.

On June 12, 2008, pursuant to the Agreement and Plan of Merger (the “Merger Agreement”), dated as of March 31, 2008, by and among Vantage Drilling Company, a Cayman Islands corporation (the “Company”), Vantage Energy Services, Inc., a Delaware corporation (“Vantage Energy”) and VTG Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), Merger Sub merged with and into Vantage Energy (the “Merger”).  As a result of the Merger, Vantage Energy became a wholly-owned subsidiary of the Company.

Pursuant to the Merger, each unit, share of common stock and warrant to purchase a share of common stock of Vantage Energy, other than those held by holders of shares of common stock of Vantage Energy that elected to have their shares converted into cash, was converted on a one-for-one basis into the right to receive a unit, ordinary share and warrant to purchase an ordinary share, respectively, of the Company.

Concurrently with the Merger, pursuant to the Share Purchase Agreement (the “Purchase Agreement”) dated as of August 31, 2007, as amended, by and among Vantage Energy, F3 Fund and Offshore Group Investments Limited (“OGIL”), the Company acquired all of the outstanding shares of OGIL in exchange for aggregate consideration of $331.0 million, consisting of ordinary shares of the Company and warrants to purchase, subject to certain closing adjustments, ordinary shares of the Company, and a promissory note in the principal amount of $56.0 million (the “Acquisition”).  F3 Fund is wholly-owned by Hsin-Chi Su, who was appointed to the board of directors of the Company upon closing of the Acquisition and Merger.  OGIL’s assets consisted primarily of construction and delivery contracts relating to four Baker Marine Pacific Class 375 ultra-premium jackup drilling rigs (the “Jackup Rigs”), a purchase agreement for a DSME ultra-deepwater drillship (the “Drillship”) and an option for the purchase of a second Drillship currently under development.

The issuance of the Company’s ordinary shares pursuant to the Merger was registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the Company’s registration statement on Form S-4 (File No. 333-147797) (the “Registration Statement”) filed with the Securities and Exchange Commission and declared effective June 10, 2008.  The definitive joint proxy statement/prospectus of Vantage Energy and the Company, dated June 16, 2008, that forms a part of the Registration Statement (the “Joint Proxy Statement/Prospectus”) contains additional information about the Merger and Acquisition, including information concerning interests of directors, executive officers and affiliates of the Company, Vantage Energy and F3 Fund.

The Company’s units, ordinary shares and warrants to purchase ordinary shares have been approved for listing and trade on the American Stock Exchange under the symbols VTG.U, VTG and VTG.WS, respectively.

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Item 2.03.  Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

On June 12, 2008, the Company entered into the Credit Agreement dated June 12, 2008 (the “Credit Agreement”), by and among Emerald Driller Company, a Cayman Islands exempted company (“Borrower 1”), Sapphire Driller Company, a Cayman Islands exempted company (“Borrower 2”), Aquamarine Driller Company, a Cayman Islands exempted company (“Borrower 3”), and Topaz Driller Company, a Cayman Islands exempted company (“Borrower 4,” and together with Borrower 1, Borrower 2 and Borrower 3, collectively, the “Borrowers”), the Company and certain subsidiaries of the Company, as guarantors (the Company and such subsidiaries, collectively, the “Guarantors”), the lenders from time to time party thereto (the “Lenders”), Natixis, as Facility Agent and Collateral Agent for the Lenders, and Natixis, BTMU Capital Corporation, and Fortis Capital Corp., as mandated lead arrangers and joint bookrunners.

The Credit Agreement allows the Company to make borrowings (collectively, the “Credit Facilities”) consisting of (i) an advancing term facility consisting of 4 separate tranches of up to $80,000,000 per tranche, in an aggregate amount not to exceed $320,000,000 (collectively, the “Term Facility”), (ii) an advancing term facility consisting of 4 separate tranches of up to $20,000,000 each, in an aggregate amount not to exceed $80,000,000 (collectively, the “Top-Up Facility”), and (iii) a revolving credit facility of up to $40,000,000, the entire amount of which is available (subject to the terms and conditions of the Credit Agreement) for revolving loans and for the issuance of letters of credit (the “Revolving Credit Facility”).  The proceeds of the Term Facility are to be used to finance the construction of the four Jackup Rigs or to reimburse the applicable Borrower for moneys used from funds held in trust to finance the construction of the Jackup Rigs.  The proceeds of the Top-Up Facility are for general corporate purposes.  The proceeds of the Revolving Credit Facility are for working capital, the issuance of letters of credit, and for other corporate purposes.

Each Jackup Rig is financed under a separate tranche under the Term Facility.  An advance under a particular tranche of the Term Facility must correspond to the applicable installment of the purchase price under the rig construction contract for the applicable Jackup Rig.  Advances under any particular tranche of the Term Facility are not available after the delivery of the Jackup Rig that is financed under such tranche.  Each Jackup Rig is also financed under a separate tranche under the Top-Up Facility.  Advances under any particular tranche of the Top-Up Facility are available after the delivery of the applicable Jackup Rig until the maturity date for top-up advances for such Jackup Rig (as determined in accordance with the Credit Agreement).  Advances under the Revolving Credit Facility are available after the delivery of the first Jackup Rig until June 30, 2017.

Unless the obligations under the Credit Agreement are accelerated, (i) the maturity date for each tranche under the Term Facility varies depending upon the delivery date of the applicable Jackup Rig, (ii) the aggregate principal amount of the advances made under each tranche of the Top-Up Facility are due in equal quarterly installments during the term of the applicable drilling contract pursuant to which such advances were made, and (iii) the outstanding principal balance under the Revolving Credit Facility is due and payable on June 30, 2017.

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The interest rate for each of the Credit Facilities is based on LIBOR and is subject to adjustment based on the delivery status and the operational status of each Jackup Rig.  The Facility is secured by a lien on substantially all of the assets of the Borrowers and the Guarantors, including all of the equity interests of certain subsidiaries of the Company whose jurisdiction or organization is the Cayman Islands, and all of the Company’s equity interests in Vantage Energy, but excluding all of the Company’s equity interests in its subsidiaries whose jurisdiction of organization is Singapore.

The Company is subject to certain limitations under the Agreement, including restrictions on the ability to:  make any dividends, distributions or other restricted payments; incur debt or sell assets; make certain investments and acquisitions; and grant liens.  The Company is also required to comply with certain financial covenants, including a covenant which limits capital expenditures, a maximum leverage ratio covenant, a maximum net debt to capitalization ratio covenant, a covenant which requires the maintenance of cash balances above a certain threshold level, a minimum working capital ratio, and a minimum fixed charge coverage ratio.

The Credit Agreement contains customary events of default, the occurrence of which could lead to an acceleration of the Company’s obligations thereunder.

The foregoing description of the Credit Agreement is qualified in its entirety by reference to the Credit Agreement filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 3.02.  Unregistered Sales of Equity Securities.

Pursuant to the terms of the Purchase Agreement as consideration for the outstanding shares of OGIL, on June 12, 2008, the Company issued 33,333,333 ordinary shares and warrants to purchase 25,000,000 ordinary shares of the Company to F3 Fund in reliance on the exemption from the registration requirements pursuant to Section 4(2) of the Securities Act.

The warrants have an exercise price of $6.00 per share.  The warrants will expire on May 24, 2011, at 5:00 p.m., New York City time.  The Company may call the warrants for redemption, in whole and not in part, at a price of $.01 per warrant at any time after the warrants become exercisable, upon not less than 30 days’ prior written notice of redemption to each warrant holder, if and only if, the last reported sale price of the ordinary shares equals or exceeds $11.50 per share, for any 20 trading days within a 30 trading day period ending on the third business day prior to the notice of redemption.

The exercise price and number of ordinary shares issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or the Company’s recapitalization, reorganization, merger or consolidation.  However, the warrants will not be adjusted for issuances of ordinary shares at a price below the exercise price.

The Company has entered into a registration rights agreement with F3 Fund and agreed to register the resale of the 33,333,333 ordinary shares and the 25,000,000 ordinary shares issuable upon exercise of the warrants.  The registration rights agreement is filed as Exhibit 10.3 to this Current Report on Form 8-K.

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Item 5.01.  Change in Control of Registrant.

Upon completion of the Merger and Acquisition on June 12, 2008, a change of control of the Company occurred.  Immediately prior to these transactions, Paul A. Bragg, the Company’s Chairman and Chief Executive Officer, was the Company’s sole shareholder.  In connection with, and upon completion of, the Merger and Acquisition the ordinary share of the Company owned by Mr. Bragg immediately prior to the Merger was canceled, the former security holders of Vantage Energy became security holders of the Company in accordance with the terms of the Merger Agreement and 33,333,333 ordinary shares and warrants to purchase 25,000,000 ordinary shares were issued to F3 Fund in accordance with the terms of the Purchase Agreement.

Item 5.02.  Departure of Directors on Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

A.Election of Directors

Pursuant to the terms of the Purchase Agreement, the Company has agreed to nominate up to three persons designated by F3 Fund for election to the Company’s board of directors.  Hsin-Chi Su, Robert F. Grantham and Steinar Thomassen were designated by F3 Fund.  Additionally, Hsin-Chi Su, the sole owner of F3 Fund, owns, excluding ordinary shares issuable upon exercise of warrants, approximately 44% of the Company’s issued and outstanding ordinary shares.  See Item 2.01 above for a description of the the Acquisition. Except as described above, the Company is not aware of any other transaction in which either Hsin Chi Su, Robert F. Grantham or Steinar Thomassen has an interest requiring disclosure under Item 404(a) of Regulation S-K.

In connection with the closing of the Merger and the Acquisition, the following individuals were appointed to the Company’s board of directors and the identified committees of the board:

	Committee Membership
Name	Audit Committee	Compensation Committee	Nominating and Governance Committee
Paul A. Bragg
Jorge E. Estrada	X		X
Marcelo D. Guiscardo		X
John C. G. O’Leary	X		X
John R. Russell		X
Christopher G. DeClaire
Hsin-Chi Su		X
Robert F. Grantham			X
Steinar Thomassen	X

Set forth below is certain information (including age as of June 16, 2008) regarding each director of the Company.

Paul A. Bragg, 51, has served as the Company’s and Vantage Energy’s Chairman of the Board of Directors and Chief Executive Officer since their inception.  Mr. Bragg has over

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31 years of direct industry experience.  Prior to joining the Company, Mr. Bragg was affiliated with Pride International, Inc., one of the world’s largest international drilling and oilfield services companies.  From 1999 through 2005, Mr. Bragg served as the Chief Executive Officer of Pride International, Inc.  From 1997 through 1999, Mr. Bragg served as its Chief Operating Officer, and from 1993 through 1997, Mr. Bragg served as its Vice President and Chief Financial Officer.  Mr. Bragg graduated from the University of Texas at Austin in 1977 with a B.B.A. in Accounting.

Christopher G. DeClaire, 48, has served as the Company’s Vice President, Secretary and a director since the Merger and served as Vantage Energy’s Chief Financial Officer and Treasurer from its inception until November 2, 2007 and Vice-President, Secretary and director since its inception.  Mr. DeClaire has over 28 years of experience.  Mr. DeClaire is the President of DeClaire Interests, Inc., a private investment and consulting firm that he formed in 2002.  From 1999 through December 2002, Mr. DeClaire was a principal and managing director of Odyssey Capital, LLC, an investment banking and private equity firm.  From 1994 through 1998, Mr. DeClaire served as the Chief Executive Officer of Skillmaster, Inc., a temporary staffing company.  Mr. DeClaire graduated from Michigan State University in 1982 with a bachelor’s degree in pre-law with a minor in accounting.

Jorge E. Estrada M, 60, has served as a director since the Merger and was a director of Vantage Energy since its inception.  Mr. Estrada has over 37 years of direct industry experience.  From July 1993 to January 2002, Mr. Estrada was employed as a consultant to Pride International, Inc.  From January 2002 to May 2005 he was employed by Pride International, Inc. in a business development capacity.  He also served as a director of Pride International, Inc. from July 1993 until May 2005.  Mr. Estrada is also the President and Chief Executive Officer of JEMPSA Media and Entertainment.  Mr. Estrada received a B.S. in Geophysics from Washington and Lee University, and was a PhD candidate at the Massachusetts Institute of Technology.

Robert F. Grantham, 51, has served as a director of the Company since the Merger.  Mr. Grantham has over 20 years of industry experience.  From 1982 to 2006 he held senior management positions with various maritime shipping companies.  He is currently a director for a number of companies based in the United Kingdom including, Bluewave Services, Ltd, a shipping consultancy specializing in commercial operations of LNG vessels, The Medical Warehouse LTD and TMT UK Ltd.

Marcelo D. Guiscardo, 55, has served as a director of the Company since the Merger and was a director of Vantage Energy since its inception.  Mr. Guiscardo has 33 years of direct industry experience.  From December 2007 to date Mr. Guiscardo has been a director of Cold Creek Energy, S.A., an E&P company specializing in Latin America.  From June 2006 to date he has been a founding director of a private Argentine company, QM Equipment, S.A., which specializes in design, manufacture and construction of oil field equipment serving Latin America.  He served as president of Pioneer Natural Resources, Inc.’s Argentine subsidiary from January 2005 until May 2006.  From March 2000 until January 2005, he was Vice President, E&P Services for Pride International, Inc.  From September 1999 until joining Pride International, Inc., he was President of GDM Business Development, a private company providing consulting services to the energy industry.  From November 1993 until September 1999, Mr. Guiscardo held two executive officer positions with and was a director of YPF Sociedad Anonima (now part of Repsol YPF S.A.), an international integrated energy company.  Mr. Guiscardo was YPF’s Vice President of Business Development in 1998 and 1999.  Prior to that, he was YPF’s Vice President of Exploration and Production.  From 1979 to 1993 he filled a variety of positions for Exxon Company USA and Exxon International (now ExxonMobil) that culminated in having E&P responsibilities over the Middle East (Abu Dhabi,

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Egypt, Saudi Arabia and Yemen), France, Thailand and Cote d’Ivoir.  Mr. Guiscardo graduated in May 1979 with a B.S. in Civil Engineering from Rutgers College of Engineering.

John C. G. O’Leary, 52, has served as a director of the Company since the Merger and was a director of Vantage Energy since its inception.  Mr. O’Leary has over 31 years of direct industry experience.  Mr. O’Leary is a member of the boards of directors of Technip, Huisman-Itrec and Atlantic Oilfield Services.  Mr. O’Leary is the CEO of Strand Energy, an independent consultancy firm with head office in Dubai, UAE, providing advisory and brokerage services to clients in the upstream energy industry.  Prior to forming Strand Energy and from 2004 to 2006, Mr. O’Leary was a partner of Pareto Offshore ASA, a consultancy firm based in Oslo, Norway, providing consultancy and brokerage services to customers in the upstream energy industry.  Prior to commencing with Pareto Offshore in November 2004, Mr. O’Leary was President of Pride International, Inc.  He joined Pride International, Inc. in 1997 as Vice President of Worldwide Marketing.  Mr. O’Leary received an Honors B.E. in civil engineering from University College, Cork, Ireland in 1977.  He holds two post-graduates degrees, one in finance from Trinity College, Dublin and one in petroleum engineering from the French Petroleum Institute in Paris.

John R. Russell, 68, has served as a director of the Company since the Merger and was a director of Vantage Energy since its inception. Mr. Russell has over 46 years of direct industry experience. Mr. Russell served as President of Baker Hughes from August 1998 until his retirement in October 1998. Previously, he served as President and Chief Executive Officer of Western Atlas from 1997 until August 1998, when the company was acquired by Baker Hughes Incorporated. Mr. Russell previously served as Executive Vice President and Chief Operating Officer, Oilfield Services, of Western Atlas from 1994 until the spin-off of the company from Litton Industries, when he was named President and Chief Executive Officer of the company.

Hsin Chi Su, 49, has served as a director of the Company since the Merger. Since 2002, Mr. Hsin Chi Su has served as Chief Executive Officer of TMT Co., Ltd. Under the direction of Mr. Hsin Chi Su, TMT Co., Ltd. has expanded its fleet to include drybulk carriers, very large crude carriers, cargo carriers, liquefied natural gas carriers, automobile carriers, and cement carriers. In addition to increasing the service capabilities of TMT Co., Ltd., Mr. Hsin Chi Su has transformed TMT Co., Ltd. into a global leader in the international shipping industry. Mr. Hsin Chi Su graduated with a BSc in economics from Keio University in Japan.

Steinar Thomassen, 61, has served as a director of the Company since the Merger. Mr. Thomassen has over 31 years of direct industry experience. Mr. Thomassen served as Manager of LNG Shipping for StatoilHydroASA (formerly Statoil ASA) from August 2001 until his retirement in December 2007 and was responsible for the acquisition and construction supervision of three large LNG tankers. Previously, Mr. Thomassen served as Vice President of Industrial Shipping for Navion ASA from October 1997 to July 2001 and for Statoil ASA from September 1992 to September 1997 and was responsible for the chartering and operation of a fleet of LPG, chemical, and product tankers. Previously, Mr. Thomassen served as Chief Financial Officer of Statoil North America Inc. from December 1989 to August 1992 and functioned as the head of administration, personnel, accounting, and finance. From January 1986 until November 1989 he was employed by Statoil AS and served as Controller for the Statfjord E&P producing Division, with a production of 800 thousand bbls day. From May 1976 until

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December 1986, Mr. Thomassen was employed by Mobil Exploration Norway Inc., during this period he held various international positions, including Project Controller for the 3 billion Statfjord Development, and served as Project Controller and Treasurer of the 2.5 billion Yanbu Development Project in Saudi Arabia from January 1982 until December 1986. Mr. Thomassen graduated from in from the Oslo School of Marketing in 1968.

B.Compensation Arrangements

In connection with the Merger and the Acquisition, the Company adopted the Vantage Drilling Company 2007 Long-Term Incentive Compensation Plan (the “Incentive Plan”), which was previously approved by the stockholders of Vantage Energy.  Under the Incentive Plan a maximum of 7,500,000 ordinary shares have been reserved for grant or issuance upon the exercise of awards made pursuant to the Incentive Plan.  Grants and awards of incentive and non-qualified stock options, stock appreciation rights, performance units, restricted stock and performance bonuses may be made under the Incentive Plan.  Officers, directors and employees of, and consultants to, the Company and its subsidiaries are eligible to participate in the Incentive Plan..

The purposes of the Incentive Plan are to create incentives designed to motivate employees to significantly contribute toward the Company’s growth and profitability, to provide executives, directors and other employees, and persons who, by their position, ability and diligence, are able to make important contributions to the Company’s growth and profitability, with an incentive to assist it in achieving long-term corporate objectives, to attract and retain executives and other employees of outstanding competence, and to provide such persons with an opportunity to acquire an equity interest in the Company.

The above summary of the Incentive Plan is qualified in its entirety by reference to the complete text of the Incentive Plan, a copy of which is filed as Exhibit 10.3 to this Current Report on Form 8-K and  is incorporated herein by reference.

C.            Employment Agreements

On June 12, 2008, the Company and its subsidiaries entered into an employment and non-competition agreement with each of the following persons: (i) Paul A. Bragg, in his capacity as Chief Executive Officer; (ii) Douglas W. Halkett, in his capacity as Chief Operating Officer; (iii) Douglas G. Smith, in his capacity as Chief Financial Officer; (iv) Michael R.C. Derbyshire, in his capacity as Vice-President, Marketing; and (v) Edward G. Brantley, in his capacity as Chief Accounting Officer.  The employment and non-competition agreements provide for compensation composed of an annual base salary, an annual cash bonus, and an annual equity award.  The annual base salary pursuant to the employment and non-competition agreements for Messrs. Bragg, Halkett, Smith, Derbyshire and Brantley are $500,000,  $400,000, $275,000, $275,0000 and $190,000, respectively.  In addition, employment and non-competition agreements provide other benefits consistent with those to be received by other executive officers.

The above summary of the employment and non-competition agreements is qualified in its entirety by reference to the complete text of the employment agreements, copies of which are filed as Exhibits 10.4 through 10.8 to this current Report on Form 8-K and are incorporated herein by reference.

Item 9.01.  Financial Statements and Exhibits.

(a)Financial Statements.

The financial statements required by this item will be filed by amendment to this report.

(b)Pro Forma Information.

Pro forma financial information will be filed by amendment to this report.

(d)Exhibits.

Exhibit Number	Description of Exhibit
2.1	Agreement and Plan of Merger by and among Vantage Drilling Company, a transitory U.S. merger subsidiary of Vantage Drilling Company and Vantage Energy Services, Inc. (Incorporated by reference to Exhibit 1.3 of the Company’s registration statement on Form S-4 (File No. 333-147797))

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2.2	Share Purchase Agreement by and among Vantage Energy Services, Inc., F3 Capital and Offshore Group Investment Limited (Incorporated by reference to Exhibit 1.1 of the Company’s registration statement on Form S-4 (File No. 333-147797))
2.3	Amendment No. 1 to Share Purchase Agreement by and among Vantage Drilling Company, Vantage Energy Services, Inc., F3 Capital and Offshore Group Investment Limited (Incorporated by reference to Exhibit 1.2 of the Company’s registration statement on Form S-4 (File No. 333-147797))
4.1	Warrant Agreement between Continental Stock Transfer & Trust Company and Vantage Drilling Company
10.1	Credit Agreement, dated as of June 12, 2008, among Emerald Driller Company, Sapphire Driller Company, Aquamarine Driller Company, and Topaz Driller Company, as Borrowers, Vantage Drilling Company and certain subsidiaries thereof party hereto, as Guarantors, the Lenders and Nataxis, as Facility Agent and Collateral Agent
10.2	Vantage Drilling Company 2007 Long-Term Incentive Compensation Plan
10.3	Registration Rights Agreement between the Registrant and F3 Capital
10.4	Employment and Non-Competition Agreement between Vantage Drilling Company and Paul A. Bragg dated June 12, 2008
10.5	Employment and Non-Competition Agreement between Vantage International Payroll Company PTE. LTD. and Douglas Halkett dated June 12, 2008
10.6	Employment and Non-Competition Agreement between Vantage Drilling Company and Douglas G. Smith dated June 12, 2008
10.7	Employment and Non-Competition Agreement between Vantage International Payroll Company PTE. LTD. and Michael R.C. Derbyshire dated June 12, 2008
10.8	Employment and Non-Competition Agreement between Vantage Drilling Company and Edward G. Brantley dated June 12, 2008

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:  June 18, 2008

  VANTAGE DRILLING COMPANY

 /s/ Chris E. Celano

  Chris E. Celano,

  General Counsel

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INDEX TO EXHIBITS

Exhibit Number	Description of Exhibit
2.1	Agreement and Plan of Merger by and among Vantage Drilling Company, a transitory U.S. merger subsidiary of Vantage Drilling Company and Vantage Energy Services, Inc (Incorporated by reference to Exhibit 1.3 of the Company’s registration statement on Form S-4 (File No. 333-147797))
2.2	Share Purchase Agreement by and among Vantage Energy Services, Inc., F3 Capital and Offshore Group Investment Limited (Incorporated by reference to Exhibit 1.1 of the Company’s registration statement on Form S-4 (File No. 333-147797))
2.3	Amendment No. 1 to Share Purchase Agreement by and among Vantage Drilling Company, Vantage Energy Services, Inc., F3 Capital and Offshore Group Investment Limited (Incorporated by reference to Exhibit 1.2 of the Company’s registration statement on Form S-4 (File No. 333-147797))
4.1	Warrant Agreement between Continental Stock Transfer & Trust Company and Vantage Drilling Company
10.1	Credit Agreement, dated as of June 12, 2008, among Emerald Driller Company, Sapphire Driller Company, Aquamarine Driller Company, and Topaz Driller Company, as Borrowers, Vantage Drilling Company and certain subsidiaries thereof party hereto, as Guarantors, the Lenders and Nataxis, as Facility Agent and Collateral Agent
10.2	Vantage Drilling Company 2007 Long-Term Incentive Compensation Plan
10.3	Registration Rights Agreement between the Registrant and F3 Capital
10.4	Employment and Non-Competition Agreement between Vantage Drilling Company and Paul A. Bragg dated June 12, 2008
10.5	Employment and Non-Competition Agreement between Vantage International Payroll Company PTE. LTD. and Douglas Halkett dated June 12, 2008
10.6	Employment and Non-Competition Agreement between Vantage Drilling Company and Douglas G. Smith dated June 12, 2008
10.7	Employment and Non-Competition Agreement between Vantage International Payroll Company PTE. LTD. and Michael R.C. Derbyshire dated June 12, 2008
10.8	Employment and Non-Competition Agreement between Vantage Drilling Company and Edward G. Brantley dated June 12, 2008

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EX-4.1

Exhibit 4.1

WARRANT AGREEMENT

This Warrant Agreement (the “Agreement”) made as of June 12, 2008, between Vantage Drilling Company, a Cayman Islands exempted company, with its registered office at c/o Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands (the “Company”), and Continental Stock Transfer & Trust Company, a New York corporation, with offices at 17 Battery Place, New York, New York 10004 (the “Warrant Agent”).

WHEREAS, in connection with the Company’s acquisition agreement with F3 Capital for ordinary shares of Offshore Group Investment Limited and merger agreement with Vantage Energy Services, Inc., a Delaware corporation (“Vantage”), the Company is offering (the “Offering”) to exchange units of the Company (the “Units”), for units of Vantage with substantially identical terms;

WHEREAS, each Unit consists of one ordinary share, par value $.001 per share, of the Company (the “Common Stock”) and one warrant exercisable for one share of Common Stock (the “Warrants”);

WHEREAS, the Company has filed, with the Securities and Exchange Commission (the “Commission”), a registration statement, No. 333-147797, on Form S-4 (the “Registration Statement”) for the registration, under the Securities Act of 1933, as amended (the “Act”), of the Units, Common Stock and Warrants included in the Units and the Common Stock issuable upon exercise of the Warrants;

WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange, redemption, exercise and cancellation of the Warrants;

WHEREAS, the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights and immunities of the Company, the Warrant Agent and the holders of the Warrants; and

WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on behalf of the Warrant Agent, as provided herein, the legally valid and binding obligations of the Company, and to authorize the execution and delivery of this Agreement.

NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:

1.  Appointment of Warrant Agent.  The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance with the terms and conditions set forth in this Agreement.

2.  Warrants.

2.1  Form of Warrant.  Each Warrant shall be issued in registered form only, shall be in substantially the form of Warrant attached hereto as Exhibit A, the provisions of which are incorporated herein, and shall be signed by, or bear the facsimile signature of, (i) the Chairman of the Board, the Chief Executive Officer or the President, and (ii) the Treasurer, Secretary or Assistant Secretary of the Company, and shall bear a facsimile of the Company’s seal. In the event the person whose facsimile signature has been placed upon any Warrant shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant is issued, it may be issued with the same effect as if he or she had not ceased to be such at the date of issuance.

2.2  Effect of Countersignature.  Unless and until countersigned by the Warrant Agent pursuant to this Warrant Agreement, a Warrant shall be invalid and of no effect and may not be exercised by the holder thereof.

2.3  Registration.

2.3.1  Warrant Register.The Warrant Agent shall maintain books (“Warrant Register”), for the registration of the original issuance and registration of transfers of the Warrants. Upon the initial issuance of the Warrants, the Warrant Agent shall issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance with instructions delivered to the Warrant Agent by the Company.

2.3.2  Registered Holder.Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the person in whose name such Warrant shall be registered upon the Warrant Register (“registered holder”), as the absolute owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other writing on the warrant certificate made by anyone other than the Company or the Warrant Agent), for the purpose of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.

2.4  Intentionally Left Blank

2.5  The Private Warrants and Representative’s Warrants.  The Warrants issued by Vantage to Deutsche Bank Securities, Inc. (the “Representative”) or its designees (the “Representatives Warrants”) shall have the same terms and be in the same form as the Warrants except (i) with respect to the Warrant Price as set forth below in Section 3.1 hereof and (ii) the Representative’s Warrants may be exercised on cashless basis. The Warrants issued by Vantage to the founders of Vantage (the “Private Warrants”) shall have the same terms and be in the same form as the Warrants issued by Vantage in its initial public offering except (i) with respect to the restrictions on transferability pursuant to Section 5.6 of that certain securities escrow agreement (the “Escrow Agreement”) of even date herewith and (ii) the Private Warrants are not subject to redemption as set forth in Section 6.5 hereof.

3.  Terms and Exercise of Warrants.

3.1  Warrant Price.  Each Warrant shall, when countersigned by the Warrant Agent, entitle the registered holder thereof, subject to the provisions of such Warrant and of this Agreement, to subscribe for the Company the number of shares of Common Stock stated therein, at a subscription price of $6.00 per whole share, subject to the adjustments provided in Section 4 hereof and in the last sentence of this Section 3.1. Each Representative’s Warrant shall, when countersigned by the Warrant Agent, entitle the registered holder thereof, subject to the provisions of such Representative’s Warrant and of this Agreement, to subscribe for the Company the number of shares of Common Stock stated therein, at a subscription price of $7.20 per whole share, subject to the adjustments provided in Section 4 hereof and in the last sentence of this Section 3.1. The term “Warrant Price” as used in this Agreement refers to the price per share at which Common Stock may be purchased at the time a Warrant is exercised. The Company, in its sole discretion, may lower the Warrant Price at any time prior to the Expiration Date (as defined below); provided, however, that any change in the Warrant Price must apply equally to all of the Warrants, except that any amendment to the term of the Representative’s Warrants shall be subject to any limitations and conditions that may be imposed by NASD Corporate Finance Rule 2710, and provided further that any reduction in Warrant Price shall remain in effect for at least twenty (20) business days.

3.2  Duration of Warrants.  Except as set forth in this Section 3.2, a Warrant may be exercised at any time prior to 5:00 p.m., New York City time, on the earlier to occur of (i) May 24 2011 and (ii) the date fixed for redemption of the Warrants as provided in Section 6 of this Agreement (“Expiration Date”). Notwithstanding the foregoing, the Private Warrants (i) may not be sold or

2

otherwise transferred until June 12, 2009 and (ii) will not be subject to redemption so long as they are held by the founders. Except with respect to the right to receive the Redemption Price (as set forth in Section 6 hereunder), each Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this Agreement shall cease at the close of business on the Expiration Date. The Company, in its sole discretion, may extend the duration of the Warrants by delaying the Expiration Date; provided, however, that any such extension of the duration of the Warrants shall apply equally to all of the Warrants, except that any amendment to the terms of the Representative’s Warrants shall be subject to any limitations and conditions that may be imposed by NASD Corporate Finance Rule 2710. Should the Company wish to extend the Expiration Date of the Warrants, the Company shall provide at least twenty (20) days advance notice to the American Stock Exchange of such extension.

Notwithstanding the foregoing, a Warrant can expire unexercised regardless of whether a registration statement is current under the Act with respect to the Common Stock issuable upon exercise of the Warrants.

3.3  Exercise of Warrants.

3.3.1  Payment.   Subject to the provisions of the Warrant and this Warrant Agreement, a Warrant, when countersigned by the Warrant Agent, may be exercised by the registered holder thereof by surrendering it, at the office of the Warrant Agent, or at the office of its successor as Warrant Agent, in the Borough of Manhattan, City and State of New York, with the subscription form, as set forth in the Warrant, duly executed, and by paying in full, in lawful money of the United States, in cash, good certified check or good bank draft payable to the order of the Company (or as otherwise agreed to by the Company), the Warrant Price for each whole share of Common Stock as to which the Warrant is exercised and any and all applicable taxes due in connection with the exercise of the Warrant, the exchange of the Warrant for the Common Stock, and the issuance of the Common Stock.

3.3.2  Issuance of Certificates.   As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment of the Warrant Price, the Company shall issue to the registered holder of such Warrant a certificate or certificates representing the number of full shares of Common Stock to which he, she or it is entitled, registered in such name or names as may be directed by him, her or it, and, if such Warrant shall not have been exercised in full, a new countersigned Warrant for the number of shares as to which such Warrant shall not have been exercised.

3.3.3  Limitations.   Notwithstanding the foregoing, and except with respect to the Private Warrants, the Company shall not be obligated to issue any shares of Common Stock pursuant to the exercise of a Warrant and shall have no obligation to settle the Warrant exercise unless a registration statement under the Act with respect to the shares of Common Stock underlying a Warrant is effective and a current Prospectus is on file with the Commission. Except with respect to the Private Warrants, in the event that a registration statement with respect to the shares of Common Stock underlying a Warrant is not effective under the Act or a current Prospectus is not on file with the Commission, the holder of such Warrant shall not be entitled to exercise such Warrant. Notwithstanding anything to the contrary in this Agreement, under no circumstances will the Company be required to net cash settle the exercise of the Warrants. Warrants may not be exercised by, or shares of Common Stock underlying the Warrants issued to, any registered holder in any jurisdictions in which such exercise or issuance would be unlawful. For the avoidance of doubt, as a result of this Section 3.3.3, any or all of the Warrants may expire unexercised. In no event shall the registered holder of a Warrant be entitled to receive any monetary damages if the shares of Common Stock

3

underlying the Warrants have not been registered by the Company pursuant to an effective registration statement or if a current prospectus is not on file with the Commission, provided the Company has fulfilled its obligation to use its best efforts to effect such registration and ensure a current prospectus is on file with the Commission.

3.3.4  Valid Issuance.   All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this Agreement shall be validly issued, fully paid and nonassessable.

3.3.5  Date of Issuance.   Each person or entity in whose name any warrant certificate for shares of Common Stock is issued shall, for all purposes, be deemed to have become the holder of record of such shares on the date on which the Warrant was exercised and surrendered and payment of the Warrant Price was made and the name of the person or entity was entered into the Register of Members of the Company, irrespective of the date of delivery of such certificate.

4.  Adjustments.

4.1  Stock Dividends—Split-Ups.  If, after the date hereof, and subject to the provisions of Section 4.6 below, the number of outstanding shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split-up of shares of Common Stock, or other similar event, then, on the effective date of such stock dividend, split-up or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in outstanding shares of Common Stock.

4.2  Extraordinary Dividends.  If the Company, at any time during the Exercise Period, shall pay a dividend or make a distribution in cash, securities or other assets to the holders of Common Stock, other than (i) as described in Sections 4.1, 4.3 or 4.5 or (ii) regular quarterly or other periodic dividends or (any such non-excluded event being referred to herein as an “Extraordinary Dividend”), then the Warrant Price shall be decreased, effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash and/or the fair market value (as determined by the Company’s Board of Directors, in good faith) of any securities or other assets paid on each share of Common Stock in respect of such Extraordinary Dividend.

4.3  Aggregation of Shares.  If after the date hereof, and subject to the provisions of Section 4.6, the number of outstanding shares of Common Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Common Stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be decreased in proportion to such decrease in outstanding shares of Common Stock.

4.4  Adjustments in Exercise Price.  Whenever the number of shares of Common Stock that may be issued upon the exercise of the Warrants is adjusted, as provided in Sections 4.1, 4.2 and 4.3 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price, immediately prior to such adjustment, by a fraction, (i) the numerator of which shall be the number of shares of Common Stock that may be issued upon the exercise of the Warrants immediately prior to such adjustment, and (ii) the denominator of which shall be the number of shares of Common Stock so that may be issued immediately thereafter.

4.5  Replacement of Securities upon Reorganization, etc.  In case of any reclassification or reorganization of the outstanding shares of Common Stock (other than a change covered by Sections 4.1, 4.2 or 4.3 hereof), or, in the case of any merger or consolidation of the Company with or into another corporation (other than a consolidation or merger in which the Company is the continuing corporation and that does not result in any reclassification or reorganization of the

4

outstanding shares of Common Stock), or, in the case of any sale or conveyance to another corporation or entity of the assets or other property of the Company as an entirety or substantially as an entirety, in connection with which the Company is dissolved, the Warrant holders shall thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the Warrants and in lieu of the shares of Common Stock of the Company immediately theretofore receivable upon the exercise of the rights represented thereby, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the Warrant holder would have received if such Warrant holder had exercised his, her or its Warrant(s) immediately prior to such event; and if any reclassification also results in a change in shares of Common Stock covered by Sections 4.1, 4.2 or 4.3, then such adjustment shall be made pursuant to Sections 4.1, 4.2, 4.3, 4.4 and this Section 4.5. The provisions of this Section 4.5 shall similarly apply to successive reclassifications, reorganizations, mergers or consolidations, sales or other transfers.

4.6  Notices of Changes in Warrant.  Upon every adjustment of the Warrant Price or the number of shares issuable upon exercise of a Warrant, the Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment and the increase or decrease, if any, in the number of shares of Common Stock that may be issued at such price upon the exercise of a Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified in Sections 4.1, 4.2, 4.3, 4.4 or 4.5 the Company shall give written notice to each Warrant holder, at the last address set forth for such holder in the Warrant Register, of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.

4.7  No Fractional Shares.  Notwithstanding any provision contained in this Agreement to the contrary, the Company shall not issue fractional shares upon exercise of Warrants. If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise, round up to the nearest whole number the number of the shares of Common Stock to be issued to the Warrant holder.

4.8  Form of Warrant.  The form of Warrant need not be changed because of any adjustment pursuant to this Section 4, and Warrants issued after such adjustment may state the same Warrant Price and the same number of shares as is stated in the Warrants initially issued pursuant to this Agreement. However, the Company may, at any time, in its sole discretion, make any change in the form of Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.

5.  Transfer and Exchange of Warrants.

5.1  Intentionally Left Blank

5.2  Registration of Transfer.  The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant into the Warrant Register, upon surrender of such Warrant for transfer, properly endorsed with signatures properly guaranteed and accompanied by appropriate instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. The Warrants so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon the Company’s request.

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5.3  Procedure for Surrender of Warrants.  Warrants may be surrendered to the Warrant Agent, together with a written request for exchange or transfer, and, thereupon, the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the registered holder of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, that in the event a Warrant surrendered for transfer bears a restrictive legend, the Warrant Agent shall not cancel such Warrant and shall issue new Warrants in exchange therefor until the Warrant Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the new Warrants must also bear a restrictive legend.

5.3  Fractional Warrants.  The Warrant Agent shall not be required to effect any registration of transfer or exchange which will result in the issuance of a warrant certificate for a fraction of a warrant.

5.4  Service Charges.  No service charge shall be made for any exchange or registration of transfer of Warrants.

5.5  Warrant Execution and Countersignature.  The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the terms of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company, whenever required by the Warrant Agent, will supply the Warrant Agent with Warrants duly executed on behalf of the Company for such purpose.

5.6  Private Warrants.  The Private Warrants may not be sold, transferred, pledged, hypothecated or assigned until the date which is one (1) year following the consummation of a Business Combination and are subject to the terms and conditions of the Escrow Agreement.

6.  Redemption.

6.1  Redemption.  Subject to Sections 6.4 and 6.5 hereof, not less than all of the outstanding Warrants may be redeemed, at the option of the Company, at any time after they become exercisable and prior to their expiration, at the office of the Warrant Agent, upon the notice referred to in Section 6.2 hereof, at a redemption price of $.01 per Warrant (the “Redemption Price”), provided that (i) the last sales price of the Common Stock has been equal to or greater than $11.50 per share (the “Trigger Price”) on any of the twenty (20) trading days within any thirty (30) trading day period ending on the third business day prior to the date on which notice of redemption is given and (ii) the Public Warrants and the Representative’s Warrants and the shares of Common Stock underlying such Warrants are covered by an effective registration statement and a current prospectus from the beginning of the measurement period through the date fixed for redemption. The provisions of this Section 6.1 may not be modified, amended or deleted without the prior written consent of the Representative.

6.2  Date Fixed for, and Notice of, Redemption.  In the event the Company shall elect to redeem all of the Warrants, the Company shall fix a date for the redemption (the “Redemption Date”), which shall be prior to the expiration of the Warrants. Notice of redemption shall be mailed by first class mail, postage prepaid, by the Company not less than thirty (30) days prior to the date fixed for redemption to the registered holders of the Warrants to be redeemed at their last addresses as they shall appear on the Warrant Register. Any notice mailed in the manner herein provided shall be conclusively presumed to have been duly given on the date sent, whether or not the registered holder received such notice. In the event of any adjustment to the Warrant Price or the number of shares of Common Stock issuable on exercise of each Warrant as provided in Section 4, a proportional adjustment shall be made to the Trigger Price.

6.3  Exercise After Notice of Redemption.  The Warrants may be exercised in accordance with Section 3 of this Warrant Agreement at any time after notice of redemption shall have been given

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by the Company pursuant to Section 6.2 hereof and prior to the time and date fixed for redemption. On and after the redemption date, the record holder of the Warrants shall have no further rights except to receive, upon surrender of the Warrants, the Redemption Price.

6.4  Outstanding Warrants Only.  The Company understands that the redemption rights provided for by this Section 6 apply only to outstanding Warrants. To the extent a person holds rights to purchase Warrants, such purchase rights shall not be extinguished by redemption. However, once such purchase rights are exercised, the Company may redeem the Warrants issued upon such exercise, provided that the criteria for redemption are met. The provisions of this Section 6.4 may not be modified, amended or deleted without the prior written consent of the Representative.

6.5  Exclusion of Private Warrants.  Notwithstanding anything to the contrary in this Warrant Agreement, the Private Warrants shall not be subject to redemption.

6.6  No Other Rights to Cash Payment.  Except for a redemption in accordance with this Section 6, no holder of any Warrant shall be entitled to any cash payment whatsoever from the Company in connection with the ownership, exercise or surrender of any Warrant under this Agreement, regardless of whether a registration statement is current under the Act with respect to the Common Stock issuable upon exercise of the Warrants.

7.  Other Provisions Relating to Rights of Holders of Warrants.

7.1  No Rights as Shareholder.  A Warrant does not entitle the registered holder thereof to any of the rights of a shareholder of the Company, including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent or to receive notice as shareholders in respect of the meetings of shareholders or the election of directors of the Company or any other matter.

7.2  Lost, Stolen, Mutilated, or Destroyed Warrants.  If any Warrant is lost, stolen, mutilated or destroyed, the Company and the Warrant Agent may, on such terms as to indemnity or otherwise as they may in their discretion impose (which terms shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor and date as the Warrant so lost, stolen, mutilated or destroyed. Any such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time enforceable by anyone.

7.3  Reservation of Common Stock.  The Company warrants that its authorized share capital will be sufficient to permit the issuance of the relevant number of shares of Common Stock immediately following exercise in full of all outstanding Warrants issued pursuant to this Agreement.

7.4  Registration of Common Stock.  The Company agrees that, prior to the commencement of the Exercise Period, it shall file with the Commission a post-effective amendment to the Registration Statement, or a new registration statement, for the registration under the Act of, and it shall take such action as is necessary to qualify for sale in those states in which the Public Warrants and the Representative’s Warrants were initially offered by the Company, the Common Stock issuable upon exercise of the Public Warrants and the Representative’s Warrants. In either case, the Company will use its best efforts to cause the same to become effective on or prior to the commencement of the Exercise Period, to maintain the effectiveness of such registration statement and to ensure that a current prospectus is on file with the Commission until the expiration or redemption of the Warrants in accordance with the provisions of this Agreement; provided, however, that the Company shall not be obligated to issue shares of Common Stock issuable upon exercise of the Warrants, and shall not have penalties nor be liable to the Warrant holder for failure to deliver shares, if a registration statement is not effective or a current

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prospectus is not on file with the Commission at the time of exercise of the Warrant by a holder. In addition, the Company agrees to use its reasonable efforts to register such securities under the blue sky laws of the states of residence of the exercising warrant holders to the extent an exemption is not available. The provisions of this Section 7.4 may not be modified, amended or deleted without the prior written consent of the Representative.

7.5  Delivery of Prospectus or Notice.  Upon the exercise of any Warrant, if the Company requests, the Warrant Agent shall deliver to the holder of such Warrant, prior to or concurrently with the delivery of the shares of Common Stock issuable upon such exercise, in accordance with the Company’s request, either (i) a prospectus relating to the shares of Common Stock deliverable upon exercise of the Warrants and complying in all material respects with the Act or (ii) the notice referred to in Rule 173 under the Act.

8.  Concerning the Warrant Agent and Other Matters.

8.1  Payment of Taxes.  The Company will, from time to time, promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of Warrants, but the Company shall not be obligated to pay any transfer taxes in respect of the Warrants or such shares.

8.2  Resignation, Consolidation, or Merger of Warrant Agent.

8.2.1  Appointment of Successor Warrant Agent.   The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint, in writing, a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of thirty (30) days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of the Warrant (who shall, with such notice, submit his, her or its Warrant for inspection by the Company), then the holder of any Warrant may apply to the Supreme Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent. Any successor Warrant Agent, whether appointed by the Company or by such court, shall be a corporation organized and existing under the laws of the State of New York, in good standing and have its principal office in the Borough of Manhattan, City and State of New York, and be authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authorities. After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed; but, if for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and, upon request of any successor Warrant Agent, the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties and obligations.

8.2.2  Notice of Successor Warrant Agent.   In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the transfer agent for the Common Stock not later than the effective date of any such appointment.

8.2.3  Merger or Consolidation of Warrant Agent.   Any corporation into which the Warrant Agent may be merged or with which it may be consolidated or any corporation resulting from

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any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant Agent under this Agreement without any further act on the part of the Company or the Warrant Agent.

8.3  Fees and Expenses of Warrant Agent.

8.3.1  Remuneration.   The Company agrees to pay the Warrant Agent reasonable remuneration for its services as Warrant Agent hereunder as set forth on Exhibit B hereto and will reimburse the Warrant Agent upon demand for all expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.

8.3.2  Further Assurances.   The Company agrees to perform, execute, acknowledge and deliver, or cause to be performed, executed, acknowledged and delivered, all such further and other acts, instruments and assurances as may reasonably be required by the Warrant Agent for the carrying out or performing of the provisions of this Agreement.

8.4  Liability of Warrant Agent.

8.4.1  Reliance on Company Statement.   Whenever, in the performance of its duties under this Warrant Agreement, the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a statement signed by the Chief Executive Officer, Chairman of the Board of Directors or President of the Company and delivered to the Warrant Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions of this Agreement.

8.4.2  Indemnity.   The Warrant Agent shall be liable hereunder only for its own negligence, willful misconduct or bad faith. The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and reasonable counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Warrant Agreement, except as a result of the Warrant Agent’s negligence, willful misconduct or bad faith.

8.4.3  Exclusions.   The Warrant Agent shall have no responsibility with respect to the validity of this Warrant Agreement or with respect to the validity or execution of any Warrant (except its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Warrant; nor shall it be responsible to make any adjustments required under the provisions of Section 4 hereof or responsible for the manner, method or amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it, by any act hereunder, be deemed to make any representation or warranty as to the authorization or reservation of any shares of Common Stock to be issued pursuant to this Agreement or any Warrant or as to whether any shares of Common Stock will when issued be valid and fully paid and nonassessable.

8.5  Acceptance of Agency.  The Warrant Agent hereby accepts the agency established by this Warrant Agreement and agrees to perform the same upon the terms and conditions herein set forth and, among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account for, and pay to the Company, all moneys received by the Warrant Agent for the subscription for shares of Common Stock through the exercise of Warrants.

8.6  Waiver.  The Warrant Agent hereby waives any and all right, title, interest or claim of any kind (“Claim”) in or to any distribution of the Trust Account (as defined in that certain

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Investment Management Trust Agreement, dated as of the date hereof, by and between Vantage and the Warrant Agent as trustee thereunder), and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the Trust Account for any reason whatsoever.

9.  Miscellaneous Provisions.

9.1  Successors.  All the covenants and provisions of this Warrant Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their respective successors and assigns.

9.2  Notices.  Any notice, consent or request to be given in connection with any of the terms or provisions of this Agreement shall be in writing and shall be sent express mail or similar overnight courier service, by certified mail (return receipt requested), by hand delivery or by facsimile transmission:

If to the Company, to:

Vantage Drilling Company

c/o Vantage Energy Services, Inc.

777 Post Oak Blvd., Suite 610

Houston, Texas 77056

Attn: Paul A. Bragg, Chief Executive Officer

If to the Warrant Agent, to:

Continental Stock Transfer & Trust Company

17 Battery Place

New York, New York 10004

Attn: Compliance Department

with a copy in each case to:

Portert & Hedges LLP

1000 Main Street, 36th Floor

Houston, Texas 77002

Attn: Bryan Brown

and

Maples and Calder

c/o Maples Corporate Services Limited

PO Box 309, Ugland House

Grand Cayman, KY1-1104, Cayman Islands

Attn: Matthew Gardner

Any notice, sent pursuant to this Agreement shall be effective, if delivered by hand, upon receipt thereof by the party to whom it is addressed, if sent by overnight courier, on the next business day of the delivery to the courier, and if sent by registered or certified mail on the third day after registration or certification thereof.

9.3  Applicable Law.  The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in all respects by the laws of the State of New York, without giving effect to the conflict of laws principles thereof. The Company and the Warrant Agent each hereby agrees that any action, proceeding or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits to such

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jurisdiction, which jurisdiction shall be exclusive. The Company and the Warrant Agent each hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Any such process or summons to be served upon the Company or the Warrant Agent may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 9.2 hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the Company or the Warrant Agent in any action, proceeding or claim.

9.4  Persons Having Rights under this Warrant Agreement.  Nothing in this Agreement expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation, other than the parties hereto and the registered holders of the Warrants and, for the purposes of Sections 6.1, 6.4, 7.4, 9.2 and 9.8 hereof, the Representative, any right, remedy or claim under or by reason of this Agreement or of any covenant, condition, stipulation, promise or agreement hereof. the Representative shall be deemed to be a third-party beneficiary of this Agreement with respect to Sections 6.1, 6.4, 7.4, 9.2 and 9.8 hereof. All covenants, conditions, stipulations, promises and agreements contained in this Warrant Agreement shall be for the sole and exclusive benefit of the parties hereto (and the Representative, with respect to the Sections 6.1, 6.4, 7.4, 9.2 and 9.8 hereof) and their successors and assigns and of the registered holders of the Warrants.

9.5  Examination of the Agreement.  A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in the Borough of Manhattan, City and State of New York, for inspection by the registered holder of any Warrant. The Warrant Agent may require any such holder to submit his, her or its Warrant for inspection.

9.6  Counterparts; Facsimile Signatures.  This Agreement may be executed in any number of counterparts, and each of such counterparts shall, for all purposes, be deemed to be an original, and all such counterparts shall together constitute one and the same instrument. Facsimile signatures shall constitute original signatures for all purposes of this Warrant Agreement. Facsimile signatures shall constitute original signatures for all purposes of this Agreement.

9.7  Effect of Headings.  The section headings herein are for convenience only and are not part of this Warrant Agreement and shall not affect the interpretation thereof.

9.8  Amendments.  This Agreement may be amended by the parties hereto without the consent of any registered holder for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions with respect to matters or questions arising under this Warrant Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the registered holders of the Warrants. All other modifications or amendments, including any amendment to increase the Warrant Price or shorten the Exercise Period, shall require the written consent of each of the Representative and the registered holders of a majority of the then outstanding Warrants. Notwithstanding the foregoing, the Company may reduce the Warrant Price or extend the duration of the Exercise Period in accordance with Sections 3.1 and 3.2, respectively, without such consent.

9.9  Severability.  This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.

11

IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the day and year first above written.

Attest	VANTAGE DRILLING COMPANY
/s/ Chris E. Celano	By:	/s/ Paul A. Bragg
Chris E. Celano		Name: Paul A. Bragg
		Title:   Director, Chief Executive Officer
Attest	CONTINENTAL STOCK TRANSFER & TRUST COMPANY
/s/ Alexandra M. Albrecht	By:	/s/ John W. Comer, Jr.
Alexandra M. Albrecht      Vice President		Name: John W. Comer, Jr. Title:   Vice President

12

EXHIBIT A

Form of Public Warrant

13

EXHIBIT B

Warrant Agent Fees

14

EX-10.1

Exhibit 10.1

Execution Copy

CREDIT AGREEMENT

Dated as of June 12, 2008

Among

EMERALD DRILLER COMPANY,

SAPPHIRE DRILLER COMPANY,

AQUAMARINE DRILLER COMPANY,

and

TOPAZ DRILLER COMPANY,

as Borrowers,

VANTAGE DRILLING COMPANY
AND CERTAIN SUBSIDIARIES THEREOF PARTY HERETO,

as Guarantors

THE LENDERS FROM TIME TO TIME PARTY HERETO,

as Lenders,

and

NATIXIS,

as Facility Agent and Collateral Agent

NATIXIS, BTMU CAPITAL CORPORATION AND
FORTIS BANK S.A./N.V., NEW YORK BRANCH,
as Mandated Lead Arrangers

and

NATIXIS, BTMU CAPITAL CORPORATION AND
FORTIS BANK S.A./N.V., NEW YORK BRANCH,
as Joint Bookrunners

TABLE OF CONTENTS

					Page
ARTICLE I		DEFINITIONS AND ACCOUNTING TERMS			1
Section 1.01				Certain Defined Terms	1
Section 1.02				Computation of Time Periods	33
Section 1.03				Accounting Terms	33
Section 1.04				Classes of Advances	33
Section 1.05				Miscellaneous	33
ARTICLE II	THE CREDIT FACILITIES				34
Section 2.01				The Advances	34
Section 2.02				Method of Borrowing	36
Section 2.03				Fees	39
Section 2.04				Reduction of the Commitments	40
Section 2.05				Repayment	41
Section 2.06				Interest	42
Section 2.07				Prepayments	43
Section 2.08				Funding Losses	47
Section 2.09				Increased Costs	47
Section 2.10				Payments and Computations	49
Section 2.11				Taxes	50
Section 2.12				Sharing of Payments, Etc	52
Section 2.13				Applicable Lending Offices	52
Section 2.14				Letters of Credit	52
Section 2.15				Mitigation Obligations; Designation of a Different Lending Office	57
Section 2.16				Joint and Several Liability of the Borrowers	58
Section 2.17				Mitigation Obligations; Replacement of Lenders	58
ARTICLE III			CONDITIONS OF LENDING		59
Section 3.01				Initial Conditions Precedent	59
Section 3.02				Conditions Precedent to Term Borrowings	63
Section 3.03				Conditions Precedent to Top-Up Borrowings	64
Section 3.04				Conditions Precedent to Revolving Borrowings	64
Section 3.05				Conditions Precedent to Each Borrowing	64
Section 3.06				Determinations Under Sections 3.01, 3.02, 3.03, 3.04 and 3.05	65

i

			Page
ARTICLE IV	REPRESENTATIONS AND WARRANTIES		65
Section 4.01		Existence; Subsidiaries	65
Section 4.02		Power and Authority	65
Section 4.03		Authorization and Approvals	65
Section 4.04		Enforceable Obligations	66
Section 4.05		Financial Statements; No Material Adverse Effect	66
Section 4.06		True and Complete Disclosure	67
Section 4.07		Litigation	67
Section 4.08		Compliance with Laws	67
Section 4.09		No Default	68
Section 4.10		Subsidiaries; Corporate Structure	68
Section 4.11		Condition of Properties	68
Section 4.12		Environmental Condition	68
Section 4.13		Insurance	68
Section 4.14		Taxes	69
Section 4.15		ERISA Compliance	69
Section 4.16		Security Interests	70
Section 4.17		Labor Relations	70
Section 4.18		Intellectual Property	71
Section 4.19		Solvency	71
Section 4.20		Margin Regulations	71
Section 4.21		Investment Company Act	72
Section 4.22		Rig Construction Contracts	72
ARTICLE V	AFFIRMATIVE COVENANTS		72
Section 5.01		Preservation of Existence, Etc	72
Section 5.02		Compliance with Laws, Etc	72
Section 5.03		Maintenance of Property	72
Section 5.04		Maintenance of Insurance	73
Section 5.05		Payment of Taxes, Etc	77
Section 5.06		Reporting Requirements	78
Section 5.07		Other Notices	81
Section 5.08		Books and Records; Inspection	82

ii

			Page
Section 5.09		Use of Proceeds	82
Section 5.10		Nature of Business	83
Section 5.11		Operation of Rigs	83
Section 5.12		Additional Guarantors	84
Section 5.13		Further Assurances in General	84
Section 5.14		Delivery Date Collateral Requirements	85
Section 5.15		Drilling Contracts	88
Section 5.16		Separate Existence	88
Section 5.17		Post-Closing Requirements	89
ARTICLE VI	NEGATIVE COVENANTS		90
Section 6.01		Liens, Etc	90
Section 6.02		Debts, Guaranties and Other Obligations	91
Section 6.03		Merger or Consolidation	92
Section 6.04		Asset Sales	92
Section 6.05		Investments	93
Section 6.06		Restricted Payments	93
Section 6.07		Change in Nature of Business	94
Section 6.08		Transactions With Affiliates	94
Section 6.09		Maintenance of Ownership of Subsidiaries	94
Section 6.10		Agreements Restricting Liens and Distributions	94
Section 6.11		Limitation on Accounting Changes or Changes in Fiscal Periods	95
Section 6.12		Sale and Leaseback Transactions and other Off-Balance Sheet Liabilities	95
Section 6.13		Amendment of Material Contracts	95
Section 6.14		Operation of Rigs	95
Section 6.15		Bank Accounts	96
Section 6.16		Capital Expenditures	96
Section 6.17		Leverage Ratio	96
Section 6.18		Net Debt to Capitalization Ratio	97
Section 6.19		Free Cash Balances	97
Section 6.20		Working Capital Ratio	97

iii

				Page
Section 6.21			Fixed Charge Coverage Ratio	97
ARTICLE VII		EVENTS OF DEFAULT		97
Section 7.01			Events of Default	97
Section 7.02			Optional Acceleration of Maturity	100
Section 7.03			Automatic Acceleration of Maturity	100
Section 7.04			Non-exclusivity of Remedies	101
Section 7.05			Right of Set-off	101
Section 7.06			Application of Proceeds	101
ARTICLE VIII		THE GUARANTY		103
Section 8.01			Liabilities Guaranteed	103
Section 8.02			Nature of Guaranty	103
Section 8.03			Agent’s Rights	104
Section 8.04			Guarantor’s Waivers	104
Section 8.05			Maturity of Obligations, Payment	105
Section 8.06			Agent’s Expenses	105
Section 8.07			Liability	105
Section 8.08			Events and Circumstances Not Reducing or Discharging any Guarantor’s Obligations	105
Section 8.09			Subordination of All Guarantor Claims	107
Section 8.10			Claims in Bankruptcy	108
Section 8.11			Payments Held in Trust	108
Section 8.12			Benefit of Guaranty	108
Section 8.13			Reinstatement	109
Section 8.14			Liens Subordinate	109
Section 8.15			Guarantor’s Enforcement Rights	109
Section 8.16			Limitation	109
Section 8.17			Contribution Rights	110
ARTICLE IX	THE AGENTS AND THE ISSUING BANKS			110
Section 9.01			Appointment and Authority	110
Section 9.02			Rights as a Lender	111
Section 9.03			Exculpatory Provisions	111
Section 9.04			Reliance by Agent	112

iv

			Page
Section 9.05		Delegation of Duties		112
Section 9.06		Resignation of Agents		112
Section 9.07		Non-Reliance on Mandated Lead Arrangers, Joint Bookrunners, Agents and Other Lenders		113
Section 9.08		Indemnification		113
Section 9.09		Collateral and Guaranty Matters		114
Section 9.10		No Other Duties, etc		115
ARTICLE X	MISCELLANEOUS			115
Section 10.01		Amendments, Etc		115
Section 10.02		Notices, Etc		117
Section 10.03		No Waiver; Cumulative Remedies		118
Section 10.04		Costs and Expenses		118
Section 10.05		Indemnification		119
Section 10.06		Successors and Assigns		120
Section 10.07		Confidentiality		123
Section 10.08		Execution in Counterparts		124
Section 10.09		Survival of Representations, etc		124
Section 10.10		Severability		124
Section 10.11		Interest Rate Limitation		125
Section 10.12		The Platform		125
Section 10.13		Governing Law		125
Section 10.14		Submission to Jurisdiction		125
Section 10.15		Waiver of Jury		126
Section 10.16		Entire agreement		126
Section 10.17		Judgment Currency		127
Section 10.18		USA Patriot Act Notice		127
Section 10.19		Fee Letters		127

v

EXHIBITS:

Exhibit A	-	Form of Assignment and Acceptance
Exhibit B	-	Form of Assignment of Earnings
Exhibit C	-	Form of Assignment of Insurance
Exhibit D	-	Form of Charter Assignment
Exhibit E	-	Form of Collateral Assignment of Rig Construction Contracts
Exhibit F	-	Form of Compliance Certificate
Exhibit G	-	Form of Notice of Borrowing
Exhibit H	-	Form of Notice of Continuation
Exhibit I	-	Form of Pledge Agreement
Exhibit J	-	Reserved
Exhibit K	-	Form of Security Agreement
Exhibit L	-	Form of Excess Cash Flow Certificate

ANNEXES AND SCHEDULES:

Annex I	-	Commitments
Schedule 1.01(a)	-	Acceptable National Oil Companies
Schedule 2.01	-	Shipyard Installments and Equity Portion of Rigs’ Total Cost
Schedule 4.10	-	Subsidiaries
Schedule 5.04	-	Loss Payable Clause
Schedule 6.15	-	Bank Accounts
Schedule 10.02	-	Addresses for Notice

vi

CREDIT AGREEMENT

This Credit Agreement dated as of June 12, 2008 is among Emerald Driller Company, a Cayman Islands exempted company (“Borrower 1”), Sapphire Driller Company, a Cayman Islands exempted company (“Borrower 2”), Aquamarine Driller Company, a Cayman Islands exempted company (“Borrower 3”), Topaz Driller Company, a Cayman Islands exempted company (“Borrower 4”; together with Borrower 1, Borrower 2 and Borrower 3, the “Borrowers”), the Guarantors (as defined below), the Lenders, and Natixis, as Facility Agent and Collateral Agent for the Lenders.

The Borrowers, the Guarantors, the Lenders, the Facility Agent and the Collateral Agent agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

Section 1.01           Certain Defined Terms.  Any capitalized terms used in this Agreement that are defined in Article 9 of the Uniform Commercial Code as adopted in the State of New York (“UCC”) shall have the meanings assigned to those terms by the UCC as of the date of this Agreement.  As used in this Agreement, the terms defined above shall have the meanings set forth therein and the following terms shall have the following meanings (unless otherwise indicated, such meanings to be equally applicable to both the singular and plural forms of the terms defined):

“Acceptable Credit Support” means a performance bond or a letter of credit, each issued from an Acceptable Credit Support Provider, each in a form reasonably acceptable to the Facility Agent and which supports 100% of the obligations of the counterparty to a dayrate drilling contract for the full term of such contract.

“Acceptable Credit Support Provider” means an issuer of Acceptable Credit Support that is a commercial bank (a) organized under the laws of any other country which is a member of the Organization for Economic Cooperation and Development (“OECD”), or a political subdivision of any such country, (b) having total assets in excess of $1,000,000,000, provided that such bank is acting through a branch or agency located in the country in which it is organized or another country which is also a member of the OECD and (c) reasonably approved by the Facility Agent.

“Acceptable Flag Jurisdiction” means each of the Bahamas, Liberia, the Marshall Islands, Panama, Singapore and any other offshore jurisdiction acceptable to the Majority Lenders.

“Acceptable Security Interest” in any Property means a Lien which (a) exists in favor of the Collateral Agent for the benefit of the Secured Parties; (b) is superior to all other Liens except Permitted Prior Liens; (c) secures the Obligations; (d) is perfected; and (e) is enforceable against the Loan Party that created such security interest.

“Account Control Agreement” means, with respect to any deposit account of any Loan Party is held with a bank that is not the Facility Agent or the Collateral Agent, an agreement or agreements in form and substance reasonably acceptable to the Collateral Agent between the

Collateral Agent and such other bank or banks governing any such deposit accounts of such Loan Party.

“Additional Costs” means, with respect to each Rig, the OFE (as defined in the applicable Rig Construction Contract), project management and start-up costs, legal and bank fees, and interest expense during construction of such Rig.

“Adjusted Base Rate” means, for any day, a fluctuating rate of interest per annum equal to the rate determined by the Facility Agent to be the arithmetic average (rounded in accordance with normal market practice) of the rates reported to the Facility Agent by each Reference Lender as the rate at which such Reference Lender offers to place deposits in U.S. dollars with first class banks in the London interbank market at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period, in the approximate amount of such Reference Lender’s relevant Advance and having a maturity equal to an Interest Period of three months.  If any Reference Lender fails to provide such quotation to the Facility Agent, then the Facility Agent shall determine the Adjusted Base Rate on the basis of the quotations of the remaining Reference Lender(s).

“Administrative Entity” means any Subsidiary of the Parent formed in connection with any Bidding Entity or Drillship Entity to provide payroll or other administrative services for a Bidding Entity or a Drillship Entity.

“Administrative Questionnaire” means an administrative questionnaire in a form supplied by the Facility Agent.

“Advance” means any Term Advance, Top-Up Advance or Revolving Advance.

“Affiliate” of any Person, means any other Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person or any Subsidiary of such Person.  The term “control” (including the terms “controlled by” or “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ability to exercise voting power, by contract or otherwise.

“Agent” means the Facility Agent or the Collateral Agent, and “Agents” means all such Persons collectively.

“Aggregate Commitment” means, for any Lender, the sum of such Lender’s Term Tranche 1 Commitment, Term Tranche 2 Commitment, Term Tranche 3 Commitment, Term Tranche 4 Commitment, Top-Up Tranche 1 Commitment, Top-Up Tranche 2 Commitment, Top-Up Tranche 3 Commitment, Top-Up Tranche 4 Commitment, and Revolving Commitment.  The Aggregate Commitments of the Lenders as of the Effective Date is $440,000,000.

“Aggregate Revolving Commitments” means the sum of the aggregate Revolving Commitments of the Lenders.  The Aggregate Revolving Commitments of the Lenders as of the Effective Date is $40,000,000.

2

“Aggregate Term Commitments” means the sum of the aggregate Term Tranche 1 Commitments, Term Tranche 2 Commitments, Term Tranche 3 Commitments and Term Tranche 4 Commitments of the Lenders.  The Aggregate Term Commitments of the Lenders as of the Effective Date is $320,000,000.

“Aggregate Top-Up Commitments” means the sum of the aggregate Top-Up Tranche 1 Commitments, Top-Up Tranche 2 Commitments, Top-Up Tranche 3 Commitments and Top-Up Tranche 4 Commitments of the Lenders.  The Aggregate Top-Up Commitments of the Lenders as of the Effective Date is $80,000,000.

“Agreement” means this Credit Agreement dated as of June 12, 2008 among the Borrowers, the Guarantors, the Lenders, the Agents, the Documentation Agent, the Syndication Agent, the Mandated Lead Arrangers and the Joint Bookrunners, as it may be amended or modified and in effect from time to time.

“Applicable Lending Office” means (a) with respect to any Lender, the office, branch, subsidiary, affiliate or correspondent bank of such Lender specified in its Administrative Questionnaire or such other office, branch, subsidiary, affiliate or correspondent bank as such Lender may from time to time specify to the Borrowers and the Facility Agent from time to time and (b) with respect to the Facility Agent, the address specified for such Person on Schedule 10.02 or to such other address, facsimile number, electronic mail address or telephone number as shall be designated by such party in a notice to the other parties.

“Applicable Margin” means, for any day, with respect to Advances of any Class or Tranche or letter of credit fees, the applicable percentage rate per annum set forth below for the status of the applicable Rig for such Tranche in effect as of the relevant date of determination:

Rig Status	Applicable Margin
Prior to the Delivery Date of such Rig or any time that such Rig is not operating under a Drilling Contract or any time such Rig is mobilizing for more than one month under a Drilling Contract	2.75	%
After the Delivery Date of such Rig and when such Rig is operating (including mobilization of no more than one month) under a Drilling Contract	2.25	%
After the Delivery Date of such Rig and when such Rig is operating (including mobilization of no more than one month) under a Drilling Contract with an initial or committed renewal term equal to or greater than two years	1.75	%

“Applicable Maturity Date” means, with respect to any Tranche, the Rig 1 Maturity Date, the Rig 2 Maturity Date, the Rig 3 Maturity Date or the Rig 4 Maturity Date.

3

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Approved Rig Appraiser” means Platou Offshore, Fearnley Offshore, ODS Petrodata, Kennedy Marr or any other first-class, international, independent, sale and purchase offshore drilling rig appraiser acceptable to the Majority Lenders.

“Asset Disposition” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person (or the granting of any option or other right to do any of the foregoing), including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

“Assignment and Acceptance” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 10.06), and accepted by the Facility Agent, in substantially the form of Exhibit A or any other form approved by the Facility Agent.

“Assignment of Earnings” means an Assignment of Earnings in substantially the form of Exhibit B among one or more of the Loan Parties and the Collateral Agent for the benefit of the Secured Parties.

“Assignment of Insurance” means an Assignment of Insurance in substantially the form of Exhibit C among one or more of the Loan Parties and the Collateral Agent for the benefit of the Secured Parties.

“Attributable Indebtedness” means, on any date, (a) in respect of any Capital Lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital lease.

“Audited Financial Statements” means the audited consolidated balance sheet of the Parent and its Subsidiaries for the fiscal year ended December 31, 2007, together with the related consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal year of the Parent and its Subsidiaries, including the notes thereto.

“Base Rate Advance” means an Advance that bears interest at a rate determined by reference to the Adjusted Base Rate.

“Bidding Entity” means any Subsidiary of the Parent formed for the purpose of preparing and submitting bid proposals for contracts for any drillship or rig (other than Rig 1, Rig 2, Rig 3, or Rig 4) for a day rate or other rate acceptable to Parent.

“Bluesky” means Bluesky Offshore Group Corp., a corporation formed under the laws of the British Virgin Islands.

4

“Borrowing” means a Term Borrowing, a Top-Up Borrowing or a Revolving Borrowing.

“Borrowing Date” means the date on which any Advance is made or any Letter of Credit is issued hereunder.

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the laws of, or are in fact closed in, New York City or Paris, France and, if such day relates to any Eurodollar Advance, means any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market.

“Capital Expenditures” means, for any Person for any period, the aggregate of all expenditures in respect of the purchase or other acquisition of any fixed or capital asset (excluding normal replacements and maintenance which are properly charged to current operations) which should be capitalized in accordance with GAAP.

“Capital Lease” of a Person means any lease of any Property by such Person as lessee that would, in accordance with GAAP, be required to be classified and accounted for as a capital lease on the balance sheet of such Person.

“Cash Equivalents” means:

(a)  direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of acquisition thereof;

(b)  direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, municipalities of the United States of America, in each case maturing within one year from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P or from Moody’s;

(c)  investments in commercial paper maturing within 270 days from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P and from Moody’s;

(d)  investments in certificates of deposit, banker’s acceptances and Dollar and Eurodollar denominated time deposits maturing within one year from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any Lender or any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof that has a combined capital and surplus and undivided profits of not less than $500,000,000;

(e)  fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria of clause (d) above; and

5

(f)  investments in “money market funds” within the meaning of Rule 2a-7 of the Investment Company Act of 1940, as amended, substantially all of whose assets are invested in investments of the type described in clauses (a) through (e) above.

“Casualty Event” means, with respect to any Rig owned by any Person, (a) any loss or damage to, or any condemnation or taking of, such Rig other than a Total Loss of any Rig, for which such Person receives, anticipates recovering or has filed a claim for Casualty Proceeds or (b) any Lien imposed by any Governmental Authority pursuant to Environmental Law and that has not been released or bonded within ten Business Days following the applicable Loan Party’s receipt of notice of such imposition unless such Lien is being contested in good faith and by appropriate proceedings.

“Casualty Proceeds” means the proceeds of any insurance, condemnation award or other compensation paid or payable to any Loan Party or the Collateral Agent in respect of any Casualty Event, less the reasonable fees, taxes and expenses paid to collect such proceeds.

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.

“Change of Control” means (a) any acquisition pursuant to which any Person or group (as defined in Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) other than the Permitted Investors, has become the direct or indirect beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of more than 35% of the Voting Stock of the Parent; (b) the Parent is merged with or into or consolidated with another Person and, immediately after giving effect to the merger or consolidation, less than a majority of the outstanding voting securities entitled to vote generally in the election of directors or persons who serve similar functions of the surviving or resulting Person are then beneficially owned (within the meaning of Rule 13d-3 of the Exchange Act) in the aggregate by (i) the stockholders of the Parent immediately prior to such merger or consolidation, or (ii) if the record date has been set to determine the stockholders of the Parent entitled to vote on such merger or consolidation, the stockholders of the Parent as of such record date; (c) the Parent, either individually or in conjunction with one or more of its Subsidiaries, sells, conveys, transfers or leases, or its Subsidiaries sell, convey, transfer or lease, all or substantially all of the assets of the Parent and its Subsidiaries, taken as a whole (either in one transaction or a series of related transactions), including Equity Interests of its Subsidiaries, to any Person except as otherwise permitted by Section 6.04; (d) the liquidation or dissolution of the Parent, (e) a majority of the individuals who constitute the Board of Directors of the Parent are not Continuing Directors or (f) the Parent shall cease to own, directly or indirectly, 100% of the Equity Interests of any Borrower.

“Charter Assignment” means a Charter Assignment in substantially the form of Exhibit D among one or more of the Loan Parties and the applicable charterer in favor of the Collateral Agent for the benefit of the Secured Parties.

6

“Charter Obligations” means all obligations (other than obligations backed by a cash-secured letter of credit) of any Person with respect to potential liquidated damages, fees or other liabilities incurred in connection with the termination or breach of charters or similar contractual arrangements entered into with respect to the charter or lease of vessels, in each case calculated on a probable loss basis in accordance with GAAP.

“Class” has the meaning set forth in Section 1.04.

“Closing Date” means June 12, 2008.

“Code” means the United States Internal Revenue Code of 1986, as amended, reformed or otherwise modified from time to time, and any successor statute and all rules and regulations promulgated thereunder.

“Collateral” means all the “Collateral” as defined in any Security Document and shall include the Rigs.

“Collateral Agent” means Natixis acting as collateral agent and/or mortgagee for the Secured Parties.

“Collateral Assignment of Rig Construction Contracts” means a Deed of Assignment with respect to Rig Construction Contracts in substantially the form of Exhibit E among one or more of the Loan Parties and the Shipyard in favor of the Collateral Agent for the benefit of the Secured Parties.

“Collateral Disposition” means (a) the Asset Disposition by any Loan Party of any Rig in its entirety and (b) any Total Loss of any Rig.

“Collateral Disposition Proceeds” means (a) with respect to any Collateral Disposition involving an Asset Disposition of a Rig, the gross proceeds thereof received by any Loan Party less the reasonable fees, taxes and expenses paid by such Person that are directly related to such Asset Disposition and the amount of reserves, if any, recorded in accordance with GAAP for indemnity or other obligations of the Parent or any of its Subsidiaries directly related to such Asset Disposition of the Rig and (b) with respect to any Collateral Disposition involving a Total Loss of a Rig, the proceeds of any insurance proceeds, condemnation award or other compensation paid or payable to any Loan Party or the Collateral Agent in respect of such Total Loss less the reasonable fees, taxes and expenses paid to collect such proceeds and the amount of reserves, if any, recorded in accordance with GAAP for indemnity or other obligations of the Parent or any of its Subsidiaries directly related to such sale of the Rig.

“Commitments” means, as to any Lender, its Term Commitments, its Top-Up Commitments and its Revolving Commitments.

“Compliance Certificate” means a Compliance Certificate signed by a Responsible Officer of the Parent in substantially the form of the attached Exhibit F.

“Confidential Information Memorandum” means the Confidential Information Memorandum dated June 2008 (together with all amendments and supplements thereto) and

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furnished to the initial Lenders in connection with the initial syndication of the Advances made hereunder.

“Consolidated EBITDA” means, for any Person for any period, without duplication, the sum of the following for such Person and its Subsidiaries on a consolidated basis, each calculated for such period: (a) Consolidated Net Income of such Person for such period of determination plus (b) to the extent deducted in determining Consolidated Net Income, Consolidated Interest Expense of such Person, charges against income for foreign, federal, state, and local taxes, depreciation and amortization expense and other non-cash charges (excluding accruals for cash expenses made in the ordinary course of business) minus (c) extraordinary or non-recurring gains for such period plus (d) extraordinary or non-recurring losses for such period minus (e) any gain realized upon the sale or other disposition of any assets of such Person or any of its Subsidiaries for such period plus (f) any loss realized upon the sale or other disposition of any assets of such Person or any of its Subsidiaries for such period minus (g) the income of any other Person (other than wholly-owned Subsidiaries of such Person) in which such Person or a wholly owned Subsidiary of such Person has an ownership interest except to the extent such income is received by such Person or such wholly-owned Subsidiary in a cash distribution during such period, all as determined on a consolidated basis in accordance with GAAP.

“Consolidated Interest Expense” means, for any Person for any period, (a) the interest expense of such Person and its Subsidiaries calculated on a consolidated basis in accordance with GAAP for such period, minus (b) the interest income of such Person and its Subsidiaries for such period and the amortization of any deferred financing costs incurred in connection with this Agreement to the extent otherwise included in the calculations thereof.

“Consolidated Net Debt” means, as of any date of determination for any Person, (a) the Debt minus (b) Free Cash Balances, in each case of such Person and its Subsidiaries calculated on a consolidated basis as of such time.

“Consolidated Net Income” means, for any Person for any period, the net income of such Person and its Subsidiaries calculated on a consolidated basis for such period after taxes, as determined in accordance with GAAP.

“Continue”, “Continuation”, and “Continued” each refers to a continuation of Advances for an additional Interest Period upon the expiration of the Interest Period then in effect for such Advances.

“Continuing Director” means an individual who (a) is a member of the full Board of Directors of the Parent and (b) either (i) was a member of the Board of Directors of the Parent on the Effective Date or (ii) whose nomination for election or election to the Board of Directors of the Parent was approved by vote of at least two-thirds of the directors then still in office who were either directors on the Effective Date or whose election or nomination for election was previously so approved.

“Debt” means, for any Person, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

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(a)           all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;

(b)           obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business);

(c)           Capital Leases;

(d)           all obligations of such Person in respect of letters of credit, bankers’ acceptances, bank guarantees, surety bonds or similar instruments which are issued upon the application of such Person or upon which such Person is an account party or for which such Person is in any way liable;

(e)           net obligations of such Person under any Swap Contract;

(f)            Off-Balance Sheet Liabilities;

(g)           indebtedness secured by a Lien on Property now or hereafter owned or acquired by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

(h)           all Charter Obligations of such Person; and

(h)           all Guarantees of such Person in respect of any of the foregoing.

For all purposes hereof, the Debt of any Person shall include the Debt of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Debt is expressly made non-recourse to such Person.  The amount of any net obligation under any Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such date.  The amount of any Capital Lease or Off-Balance Sheet Liability as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.

“Debt Service” means, for any Person for any period, the sum of the aggregate amount of (a) scheduled installments of principal and interest paid or which will be payable by such Person and (b) net settlements paid or payable under interest rate Swap Contracts, each during such period and with respect to the Advances.

“Debt Service Reserve Account” has the meaning set forth in Section 5.14(b)(iii).

“Default” means (a) an Event of Default or (b) any event or condition which with notice or lapse of time or both would, unless cured or waived, become an Event of Default.

“Delivery Date” means any of the Rig 1 Delivery Date, Rig 2 Delivery Date, Rig 3 Delivery Date and Rig 4 Delivery Date, as the context may require.

“Dollars” and “$” means the lawful money of the United States of America.

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“Drilling Contract” means any dayrate drilling contract (a) having an indicated duration of at least twelve (12) months (including any exercised extensions or committed renewals), (b) has terms and conditions satisfactory to the Joint Bookrunners, and (c) entered into between a Loan Party and a counterparty that (i) is listed on Schedule 1.01(a), (ii) is acceptable to the Joint Bookrunners and has, or whose ultimate parent has, an Investment Grade Rating or (iii) has provided Acceptable Credit Support from an Acceptable Credit Support Provider.

“Drillship Contract 1” means (a) the Contract for the Construction and Sale of One Deepwater Drillship (Hull No. 3601) dated as of September 13, 2007 between Mandarin and Daewoo Shipbuilding & Marine Engineering Co., Ltd., a corporation organized and existing under the laws of the Republic of Korea and (b) the Agreement for the Purchase of One Deepwater Drillship (Hull No. 3601) by and between Mandarin and OGIL dated as of March 24, 2008.

“Drillship Contract 2” means the Contract for the Construction and Sale of One Deepwater Drillship (Hull No. 3602) dated as of December 27, 2007 between Mandarin and Daewoo Shipbuilding & Marine Engineering Co., Ltd., a corporation organized and existing under the laws of the Republic of Korea.

“Drillship Contract Option Agreement” means Section 22 of the Agreement for the Purchase of One Deepwater Drillship (Hull No. 3601) by and between Mandarin and OGIL dated as of March 24, 2008, pursuant to which OGIL has been granted an option to purchase one deepwater drillship (Hull No. 3602) being constructed under Drillship Contract 2.

“Drillship Debt” means Debt for which (a) the drillship constructed pursuant to Drillship Contract 1 or Drillship Contract 2 serves as principal security, or (b) Drillship Contract 1, Drillship Contract 2, or the Drillship Contract Option Agreement, or some combination thereof, serves as principal security; provided, however, that (i) such Debt is non-recourse to OGIL and its Subsidiaries, (ii) neither OGIL nor any of its Subsidiaries shall have any liability whatsoever, whether direct or indirect, contingent or otherwise with respect to such Debt, and (iii) the provider of such Debt shall have no recourse to any assets of, or Equity Interests in, OGIL or its Subsidiaries (other than the Drillship Contract and the Equity Interests of any Drillship Entity).

“Drillship Documents” means (a) the Drillship Contract 1, (b) the Drillship Contract 2, (c) the Drillship Contract Option Agreement, and (d) the Transfer Agreements.

“Drillship Entity” means any Subsidiary of the Parent formed in connection with any Drillship Debt, substantially all of the assets of which consist of (a) the Drillship Contract 1, and the drillship being constructed and purchased pursuant thereto, or (b) the Drillship Contract 2, the Drillship Contract Option Agreement and the drillship being constructed and purchased pursuant thereto.

“Earnings Account” has the meaning set forth in Section 5.14(b)(i).

“Earnings Collateral” means (a) all freights, hire and other moneys earned and to be earned, due or to become due, or paid or payable to, or for the account of, any Loan Party, of whatsoever nature, arising out of or as a result of the use, operation, pooling or chartering by such Loan Party or its agents of any Rig, including, without limitation, all rights arising out of

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the owner’s lien on cargoes and subfreights thereunder, (b) all moneys and claims for moneys due and to become due to any Loan Party, and all claims for damages, arising out of the breach of any and all present and future drilling contracts, charter parties, pooling arrangements, bills of lading, contracts and other engagements of affreightment or for the carriage or transportation of cargo, and operations of every kind whatsoever of any Rig and in and to any and all claims and causes of action for money, loss or damages that may accrue or belong to any Loan Party, its successors or assigns, arising out of or in any way connected with the present or future use, operation, pooling or chartering of any Rig or arising out of or in any way connected with any and all present and future requisitions, drilling contracts, charter parties, pooling arrangements, bills of lading, contracts and other engagements of affreightment or for the carriage or transportation of cargo, and other operations of any Rig, (c) all moneys and claims due and to become due to any Loan Party, and all claims for damages and all insurances and other proceeds, in respect of the actual or constructive total loss of or requisition of use of or title to any Rig, and (d) any proceeds of any of the foregoing and all interest and earnings from the investment of any of the foregoing and the proceeds thereof.

“Effective Date” means the date on which the conditions precedent set forth in Section 3.01 shall have been satisfied, which date shall not be later than June 30, 2008.

“Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund, (d) a commercial bank organized under the laws of any other country which is a member of the OECD, or a political subdivision of any such country, and having total assets in excess of $1,000,000,000, provided that such bank is acting through a branch or agency located in the country in which it is organized or another country which is also a member of the OECD approved by the Facility Agent; and (e) any other Person (other than a natural person) approved by the Facility Agent, and, so long as no Default exists, the Parent, in either case, such approval not to be unreasonably withheld or delayed; provided that notwithstanding the foregoing, “Eligible Assignee” shall not include the Parent or any of the Parent’s Affiliates or Subsidiaries.

“Environmental Law” means all former, current and future Federal, state, local and foreign laws (including common law), treaties, regulations, rules, ordinances, codes, decrees, judgments, directives, orders (including consent orders), and agreements in each case, relating to protection of the environment, natural resources, human health and safety or the presence, Release of, or exposure to, Hazardous Materials, or the generation, manufacture, processing, distribution, use, treatment, storage, transport, recycling or handling of, or the arrangement for such activities with respect to, Hazardous Materials.

“Environmental Liability” means all liabilities, obligations, damages, losses, claims, actions, suits, judgments, orders, fines, penalties, fees, expenses and costs (including administrative oversight costs, natural resource damages and remediation costs), whether contingent or otherwise, arising out of or relating to (a) compliance or non-compliance with any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release of any Hazardous Materials or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

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“Environmental Permit” means any permit, license, order, approval or other authorization under any Environmental Law.

“Equity” means, for any Person at any time, the total shareholders’ equity of such Person and its Subsidiaries on a consolidated basis determined in accordance with GAAP.

“Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity interests in any Person, or any obligations convertible into or exchangeable for, or giving any Person a right, option or warrant to acquire, such equity interests or such convertible or exchangeable obligations.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time-to-time, and any successor statute and all rules and regulations promulgated thereunder.

“ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Parent within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by the Parent or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Parent or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Parent or any ERISA Affiliate.

“Eurocurrency Liabilities” has the meaning assigned to that term in Regulation D.

“Eurodollar Advance” means an Advance that bears interest based on the Eurodollar Rate.

“Eurodollar Rate” means, with respect to a Eurodollar Advance for the relevant Interest Period, the applicable British Bankers’ Association Interest Settlement Rate for deposits in Dollars appearing on Reuters Reference LIBOR01 as of 11:00 a.m. (London, England time) two Business Days prior to the first day of such Interest Period, and having a maturity equal to such Interest Period, provided that if the Reuters Reference LIBOR01 is not available to the Facility Agent for any reason, then the applicable Eurodollar Rate for the relevant Interest Period shall instead be the rate determined by the Facility Agent to be the rate at which the Facility Agent or one of its Affiliate banks offers to place deposits in Dollars with first class banks in the London

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interbank market at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period, in an amount equal to $10,000,000 and having a maturity equal to such Interest Period.

“Eurodollar Rate Reserve Percentage” of any Lender for the Interest Period for any Eurodollar Advance means the reserve percentage applicable during such Interest Period (or if more than one such percentage shall be so applicable, the daily average of such percentages for those days in such Interest Period during which any such percentage shall be so applicable) under regulations issued from time-to-time by the Federal Reserve Board for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for such Lender with respect to liabilities or assets consisting of or including Eurocurrency Liabilities having a term equal to such Interest Period.  The Eurodollar Rate Reserve Percentage shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

“Events of Default” has the meaning set forth in Section 7.01.

“Excess Cash Flow” has the meaning set forth in Section 7.06(a).

“Excess Cash Flow Certificate” means an Excess Cash Flow Certificate signed by a Responsible Officer of the Parent in substantially the form of the attached Exhibit L.

“Excluded Entity” means any Drillship Entity (including without limitation, Vantage Deepwater) and any Subsidiary thereof, any Bidding Entity and any Subsidiary thereof, any Administrative Entity and any Subsidiary thereof, Vantage Int’l Management (Singapore), Vantage Int’l Payroll (Singapore), and Vantage US Payroll.

“Excluded Taxes” means, with respect to any Mandated Lead Arranger, any Joint Bookrunner, any Agent, any Lender, any Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of a Loan Party hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which such Loan Party is located and (c) in the case of a Foreign Lender, any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 2.11(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from such Loan Party with respect to such withholding tax pursuant to Section 2.11(a).

“F3 Capital” means F3 Capital, a Cayman Islands exempted company also referred to as “F3 Fund”.

“Facility Agent” means Natixis in its capacity as Facility Agent for the Lenders under the Loan Documents and any successor in such capacity appointed pursuant to Section 9.06.

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“Federal Funds Effective Rate” means, for any day, a fluctuating interest rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published for such day (or, if such day is not a Business Day, for the immediately preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations at approximately 10:00 a.m. (New York time) on such day on such transactions received by the Facility Agent from three Federal funds brokers of recognized standing selected by it.

“Federal Reserve Board” means the Board of Governors of the Federal Reserve System or any of its successors.

“Fee Letters” means (a) the letter dated as of January 24, 2008 among Vantage Energy, the Joint Bookrunners and the Facility Agent, as amended by amendments dated as of May 15, 2008 and May 22, 2008 and (b) the letter dated as of January 24, 2008 between Vantage Energy and the Facility Agent.

“Final Maturity Date” means the earlier of (a) June 30, 2017 and (b) the earlier acceleration of all Obligations pursuant to Article VII.

“Fixed Charge Coverage Ratio” means, for any Person and its Subsidiaries on a consolidated basis, as of the end of any fiscal quarter, the ratio of (a) Consolidated EBITDA of such Person for such period to (b) the sum (without duplication) of foreign, federal, state, and local taxes paid in cash, Debt Service and Permitted Capital Expenditures, each for such Person and for such period.

“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which any Loan Party is resident for tax purposes. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

“Free Cash Balances” means, for any Person as at any time, for such Person and its Subsidiaries on a consolidating basis, as of any date of determination, the aggregate amount of unrestricted cash and Cash Equivalents of such Person (including amounts required by this Agreement to be deposited into and held in the Debt Service Reserve Accounts but excluding amounts required by this Agreement to be deposited into and held in the Retention Accounts).

“Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

“GAAP” means United States generally accepted accounting principles applied on a consistent basis.

“Governmental Authority” means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank, or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or

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pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Governmental Proceedings” means any action or proceedings by or before any Governmental Authority, including, without limitation, the promulgation, enactment or entry of any Legal Requirement.

“Guarantors” the Parent, OGIL, Vantage Energy, Vantage Int’l Management (Caymans), Vantage Int’l Payroll (Caymans) and any other Subsidiary of the Parent (other than any Excluded Entity).

“Guarantee” means, as to any Person, (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Debt or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment of such Debt or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the owner of such Debt or other obligation of the payment or performance of such Debt or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Debt or other obligation, or (iv) entered into for the purpose of assuring in any other manner the owner of such Debt or other obligation of the payment or performance thereof or to protect such owner against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Debt or other obligation of any other Person, whether or not such Debt or other obligation is assumed by such Person; provided, however, that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.  The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith.  The term “Guarantee” as a verb has a corresponding meaning.

“Hazardous Material” means (a) any petroleum products or byproducts and all other hydrocarbons, coal ash, radon gas, asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls and chlorofluorocarbons and (b) any chemical, material, substance or waste that is prohibited, limited or regulated by or pursuant to any Environmental Law.

“Indemnification Proceeds” means any proceeds received by any Loan Party under any Rig Construction Contract pursuant to any indemnity or warranty thereunder, including, without limitation, any payments made by the Shipyard as liquidated damages in connection with any delay in the delivery of any Rig beyond the contracted for delivery date.

“Indemnified Taxes” means any Taxes other than Excluded Taxes.

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“Insurance Advisor” means Bankserve, London Special Risk, Bankassure, AIG or an independent maritime insurance broker selected by the Collateral Agent and reasonably acceptable to the Lenders.

“Insurance Collateral” means (a) all Insurances Policies in respect of the Rigs, whether heretofore, now or hereafter effected, and all renewals of or replacements for the same, (b) all claims, returns of premium and other moneys and claims for moneys due and to become due under or in respect of the Insurance Policies, (c) all other rights of the Loan Parties under or in respect of the Insurance Policies and (d) any proceeds of any of the foregoing.

“Insurance Policies” includes (a) all insurances (including, without limitation, all certificates of entry in protection and indemnity and war risks associations or clubs) in respect of the Rigs, whether heretofore, now or hereafter effected, and all renewals of or replacements for the same, (b) all claims, returns of premium and other moneys and claims for moneys due and to become due under or in respect of said insurances, and (c) all other rights of each owner of a Rig under or in respect of said insurances.

“Interest Period” means, for each Eurodollar Advance comprising part of a Borrowing, the period commencing on the date of such Eurodollar Advance or the date of the conversion of any existing Base Rate Advance into such Eurodollar Advance and ending on the last day of the period selected by the applicable Borrower pursuant to the provisions below and Section 2.02 and, thereafter, each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the last day of the period selected by such Borrower pursuant to the provisions below and Section 2.02.  The duration of each such Interest Period shall be one, three or six months, in each case as such Borrower may select; provided, however, that:

(a)           no Borrower may select any Interest Period for any Advance which ends after any principal repayment date unless, after giving effect to such selection, the aggregate unpaid principal amount of Advances having Interest Periods which end on or before such principal repayment date shall be at least equal to the amount of Advances due and payable on or before such date;

(b)           Interest Periods commencing on the same date for Advances by each Lender comprising part of the same Borrowing shall be of the same duration;

(c)           whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day, provided that if such extension would cause the last day of such Interest Period to occur in the next following calendar month, the last day of such Interest Period shall occur on the next preceding Business Day;

(d)           any Interest Period which begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month in which it would have ended if there were a numerically corresponding day in such calendar month;

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(e)           no Borrower may select any Interest Period for any Advance which ends after the Applicable Maturity Date; and

(f)            at the Facility Agent’s sole discretion, no Borrower may select any Interest Period for any Eurodollar Advance longer than one month until the satisfactory completion of the syndication of this Agreement by the Joint Bookrunners.

“Investment” of any Person means any loan, advance (other than commission, travel and similar advances to officers and employees, drawing accounts and similar expenditures or prepayments or deposits made in the ordinary course of business) or extension of credit that constitutes Debt of the Person to whom it is extended or contribution of capital by such Person; stocks, bonds, mutual funds, partnership interests, notes (including structured notes), debentures or other securities owned by such Person; any deposit accounts and certificates of deposit owned by such Person (but excluding capital expenditures of such Person determined in accordance with GAAP).

“Investment Grade Rating” of a Person means that such Person has a minimum debt rating on its long-term senior unsecured non-credit enhanced debt securities of at least BBB- as determined by S&P and at least Baa3 as determined by Moody’s (or if such Person has only one debt rating on its long-term senior unsecured non-credit enhanced debt securities, such rating is at least BBB- as determined by S&P or at least Baa3 as determined by Moody’s).

“Issuing Bank” means Natixis or any other Lender designated in writing to the Facility Agent by the Borrower (and consented to by such Lender) as an issuer of Letters of Credit, each in their respective capacity as an issuer of Letters of Credit, and any successor Issuing Bank pursuant to Section 9.06.

“Joint Bookrunners” means Natixis, BTMU Capital Corporation and Fortis Bank S.A./N.V., New York Branch.

“LC Cash Collateral Account” means a special interest bearing cash collateral account pledged by the applicable Borrower to the Collateral Agent for the ratable benefit of the Secured Parties containing cash deposited pursuant to Section 2.07(c), 2.14(e), 7.02 or 7.03 to be maintained at the Collateral Agent’s office in accordance with Section 2.14(g) and bear interest or be invested in the Collateral Agent’s reasonable discretion.

“Legal Requirement” means, as to any Person, any law, statute, ordinance, decree, award, requirement, order, writ, judgment, injunction, rule, regulation (or official interpretation of any of the foregoing) of, and the terms of any license or permit issued by, any Governmental Authority which is binding on such Person.

“Lenders” means the lenders listed on the signature pages of this Agreement and any other Person that has become a party hereto pursuant to an Assignment and Acceptance (other than any such Person that has ceased to be a party hereto pursuant to an Assignment and Acceptance).

“Letter of Credit” means any letter of credit issued hereunder.

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“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by an Issuing Bank.

“Letter of Credit Documents” means, with respect to any Letter of Credit, such Letter of Credit, the related Letter of Credit Application and any agreements, documents, and instruments entered into in connection with or relating to such Letter of Credit.

“Letter of Credit Exposure” means, at any time, the sum of (a) the aggregate undrawn maximum face amount of each Letter of Credit at such time and (b) the aggregate unpaid amount of all Reimbursement Obligations owing with respect to such Letters of Credit at such time.

“Letter of Credit Obligations” means any obligations of the Borrowers under this Agreement in connection with the Letters of Credit.

“Leverage Ratio” means, for any Person as of the end of any fiscal quarter, the ratio of (a) Consolidated Net Debt for such Person and its Subsidiaries on a consolidated basis as of the end of such fiscal quarter to (b) Consolidated EBITDA for such Person and its Subsidiaries on a consolidated basis for the then most-recently ended four fiscal quarters.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien (statutory or other), pledge, assignment, preference, deposit arrangement, encumbrance, charge, security interest, priority or other security or preferential arrangement of any kind or nature whatsoever, whether voluntary or involuntary in or on such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

“Loan Documents” means this Agreement, any Notes issued pursuant to Section 2.02(g), the Letter of Credit Documents, the Security Documents, the Fee Letters and each other agreement, instrument or document executed by any Loan Party or any of their respective officers at any time in connection with this Agreement, all as amended, restated, supplemented or modified from time to time.

“Loan Party” means any Borrower and any Guarantor.

“Majority Lenders” means, as of any date of determination, (a) before all of the Commitments terminate, Lenders holding more than 662/3 % of the then aggregate Revolving Commitments, Unused Term Commitments, Unused Top-Up Commitments, unpaid principal amount of the Term Advances and the Top-Up Advances and (b) thereafter, Lenders holding more than 662/3% of the aggregate unpaid principal amount of the Advances and participation interests in the Letter of Credit Exposure at such time.

“Mandarin” means Mandarin Drilling Corporation, a corporation organized and existing under the laws of the Marshall Islands.

“Mandated Lead Arrangers” means Natixis, BTMU Capital Corporation, Fortis Bank S.A./N.V., New York Branch and each other Lender designated as such by the Facility Agent.

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“Market Value” means, as of any date of determination, the fair market value (or to the extent that the Rig Appraisal Reports, if two Rig Appraisal Reports are required to be delivered by this Agreement, provide for different fair market values, the arithmetical average of such fair market values) of each Rig set forth in the most recent Rig Appraisal Report covering such Rig.  To the extent that any Rig Appraisal Report provides a range of fair market values for any Rig, then the fair market value for such Rig shall be the arithmetical average of the highest and lowest fair market values given for such Rig in such Rig Appraisal Report.  Concurrently with delivery of any subsequent Rig Appraisal Reports, the Collateral Agent shall calculate the Market Values as of the date of such reports. The recalculated Market Values shall become effective immediately upon receipt of such subsequent Rig Appraisal Reports by the Collateral Agent.  In addition, each Market Value shall be adjusted from time to time to reflect any Casualty Event or any Collateral Disposition occurring with respect to any Rig to reflect the amount set forth in the Additional Appraisal Report covering such Rig to be delivered by the applicable Borrower pursuant to Section 5.06(g).

“Material Adverse Effect” means a material adverse change in, or a material adverse effect on, (a) the operations, business, assets, properties, liabilities (actual or contingent), condition (financial or otherwise) or prospects of the Loan Parties and their Subsidiaries, taken as a whole, (b) a material impairment of the rights and remedies of any Agent or any Lender upon any Loan Document, or of the ability of any Loan Party to perform its obligations under any Loan Document to which it is a party or (c) the legality, validity, binding effect or enforceability against any Loan Party of any of the Loan Documents to which it is a party.

“Maximum Rate” means the maximum nonusurious interest rate under applicable law (determined under such laws after giving effect to any items which are required by such laws to be construed as interest in making such determination, including without limitation if required by such laws, certain fees and other costs).

“Moody’s” means Moody’s Investors Service, Inc.

“Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Parent or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

“Notice of Borrowing” means a notice of borrowing in the form of the attached Exhibit G signed by a Responsible Officer of the Borrower.

“Notice of Continuation” means a notice of continuation in the form of the attached Exhibit H signed by a Responsible Officer of the Borrower.

“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Advance, Letter of Credit or any Swap Contract to which a Lender or its Affiliate is a party, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding

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under any law relating to bankruptcy, insolvency or reorganization or relief of debtors naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

“OFE” means owner furnished equipment.

“Off-Balance Sheet Liability” of a Person means (a) any repurchase obligation or liability of such Person with respect to accounts or notes receivable sold by such Person, (b) Synthetic Lease Obligations, or (c) any obligation arising with respect to any other transaction which is the functional equivalent of or takes the place of borrowing but which does not constitute a liability on the balance sheets of such Person (but, for the avoidance of doubt, excluding any Operating Leases).

“OGIL” means Offshore Group Investment Limited, a Cayman Islands exempted company.

“Operating Lease” of a Person means any lease of Property (other than a Capital Lease or an Off-Balance Sheet Liability) by such Person as lessee that has an original term (including any required renewals and any renewals effective at the option of the lessor) of one year or more.

“Other Taxes” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

“Parent” means Vantage Drilling Company, a Cayman Islands exempted company.

“Payment Dates” means the last day of each March, June, September and December.

“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

“Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Parent or any ERISA Affiliate or to which the Parent or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years.

“Permitted Capital Expenditures” means Capital Expenditures permitted to be made pursuant to Section 6.16.

“Permitted Investor” means F3 Capital, TMT, or any of their Affiliates which are controlled by Hsin Chi Su (referred to as “Nobu” or “Nobu Su”).

“Permitted Liens” has the meaning set forth in Section 6.01.

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“Permitted Operating Expenses” means, for any Person, all costs and expenses incurred by such Person in the ordinary course of its business, excluding Debt Service but including without limitation and without duplication):

(a)           operating costs and expenses incurred in connection with the administration and operation of such Person and the applicable Rig; and

(b)           all other costs and expenses which the Facility Agent acting with the consent of the Majority Lenders and such Person agree may be Permitted Operating Expenses for the applicable Rig;

up to a maximum of the sum of (i) $60,000 a day (which amount shall be escalated annually on the anniversary of the Rig 1 Delivery Date at an annual rate equal to the lesser of (A) 15% or (B) the market escalation rate (as determined by Parent and Majority Lenders)), plus (ii) other expenses or obligations that are required to be reimbursed directly by third party customers, plus (iii) for any liability for taxes which such Person has notified to the Facility Agent.

“Permitted Prior Liens” means, at any time with respect to a Rig:

(i)            Liens for crews’ wages (including the wages of the master of the Rig) that are discharged in the ordinary course of business and have accrued for not more than thirty (30) days unless any such Lien is being contested in good faith and by appropriate proceedings or other acts by the relevant Loan Party and such Loan Party shall have set aside on its books adequate reserves with respect to such Lien and so long as such deferment in payment shall not subject the Rig to sale, forfeiture or loss;

(ii)           Liens for salvage (including contract salvage) or general average, and Liens for wages of stevedores employed by the owner of the Rig, the master of the Rig or a charterer or lessee of such Rig, which in each case have accrued for not more than thirty (30) days unless any such Lien is being contested in good faith and by appropriate proceedings or other acts by the relevant Loan Party and such Loan Party shall have set aside on its books adequate reserves with respect to such Lien and so long as such deferment in payment shall not subject the Rig to sale, forfeiture or loss;

(iii)          shipyard Liens and other Liens arising by operation of law arising in the ordinary course of business in operating, maintaining and repairing the Rig (other than those referred to in (i) and (ii) above), which in each case have accrued for not more than thirty (30) days unless any such Lien is being contested in good faith and by appropriate proceedings or other acts by the relevant Loan Party, and such Loan Party shall have set aside on its books adequate reserves with respect to such Lien and so long as such deferment in payment shall not subject the Rig to sale, forfeiture or loss; provided that, except in respect of maritime Liens for necessaries provided in the United States to any Rig registered under a foreign flag, any such Lien shall be permitted only to the extent it is subordinate to the Lien of the relevant Rig Mortgage in respect of such Rig;

(iv)          Liens for damages arising from maritime torts which are unclaimed, or are covered by insurance and any deductible applicable thereto, or in respect of which a bond or

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other security has been posted on behalf of the relevant Loan Party with the appropriate court or other tribunal to prevent the arrest or secure the release of the Rig from arrest, unless any such Lien is being contested in good faith and by appropriate proceedings or other acts by the relevant Loan Party, and such Loan Party shall have set aside on its books adequate reserves with respect to such Lien and so long as such deferment in payment shall not subject the Rig to sale, forfeiture or loss;

(v)           Liens that, as indicated by the written admission of liability therefor by an insurance company, are covered by insurance (subject to reasonable deductibles);

(vi)          Liens for charters or subcharters or leases or subleases permitted under this Agreement; provided that any such Lien shall be permitted only to the extent it is subordinate to the Lien of the relevant Rig Mortgage in respect of such Rig, except with respect to any such Lien in existence on the date hereof; and

(vii)         Liens of any Rig Mortgage in favor of the Collateral Agent.

“Person” means and includes natural persons, corporations, limited partnerships, general partnerships, limited liability companies, limited liability partnerships, joint stock companies, joint ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and governments and agencies and political subdivisions thereof.

“Plan” means any Pension Plan or Multiemployer Plan.

“Pledge Agreement” means the Pledge Agreement in substantially the form of Exhibit I among one or more of the Loan Parties and the Collateral Agent for the benefit of the Secured Parties.

“Pro Forma Financial Statements” means the unaudited pro forma consolidated and consolidating balance sheet of the Parent and its Subsidiaries as of March 31, 2008 and related consolidated statements of income or operations, stockholders’ equity and cash flows for such period, prepared giving effect to the Transactions as if they had occurred on such date, including, without limitation, sufficient information in order determine the results of operations for OGIL and its Subsidiaries.

“Property” of any Person means any interest of such Person in any property or asset (whether real, personal or mixed, tangible or intangible).

“Pro Rata Share” means, with respect to each Lender at any time, (a) before all of the Commitments terminate, the ratio (expressed as a percentage) of such Lender’s Revolving Commitments, Unused Term Commitments, Unused Top-Up Commitments, and outstanding principal amount of Term Advances and Top-Up Advances at such time to the aggregate Revolving Commitments, Unused Term Commitments, Unused Top-Up Commitments, and aggregate outstanding principal amount of Term Advances and Top-Up Advances at such time and (b) thereafter, the ratio (expressed as a percentage) of such Lender’s aggregate outstanding Advances at such time to the aggregate outstanding Advances of all the Lenders at such time.  The initial Pro Rata Share of each Lender is set forth opposite the name of such Lender on

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Annex I or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

“Projections” means the Parent’s forecasted consolidated and consolidating: (a) balance sheets; (b) profit and loss statements; (c) cash flow statements; and (d) capitalization statements, all prepared on a Subsidiary by Subsidiary basis and based upon good faith estimates and assumptions by the Parent believed to be reasonable at the time made, together with appropriate supporting details and a statement of underlying assumptions.

“Proxy Statement” means the Proxy Statement dated as of May 22, 2008 filed by Vantage Energy pursuant to Section 14(a) of the Exchange Act.

“Reference Lenders” means Natixis, Fortis Bank S.A./N.V., New York Branch and The Bank of Tokyo-Mitsubishi UFJ, Ltd. London Branch.

“Regulations T, U, X and D” means Regulations T, U, X, and D of the Federal Reserve Board, as the same is from time-to-time in effect, and all official rulings and interpretations thereunder or thereof.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.

“Release” means any release, spill, emission, leaking, dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching or migration into or through the environment or within or upon any building, structure, facility or fixture.

“Reportable Event” means any of the events set forth in Section 4043(c) of ERISA.

“Responsible Officer” means the Chief Executive Officer, Chief Financial Officer, Treasurer, Chief Accounting Officer, Assistant Treasurer, Finance Director or Tax Director of a Person.

“Restricted Payment” means, with respect to any Person: (a) the declaration or making by such Person or any of its Subsidiaries of any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interest of such Person; (b) any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancelation or termination of any Equity Interests in such Person or any Subsidiary thereof or any option, warrant or other right to acquire any such Equity Interests in such Person or any Subsidiary thereof; (c) any payment or prepayment (scheduled or otherwise) of principal of, premium, if any, or interest on, any subordinated Debt, or the issuance of a notice of an intention to do any of the foregoing; and (d) any payment by such Person or any of its Subsidiaries of any management, consulting or similar fees to any Affiliate, whether pursuant to a management agreement or otherwise.

“Retention Account” has the meaning set forth in Section 5.14(b)(ii).

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“Revolving Advance” means an advance by a Lender to a Borrower as part of a Revolving Borrowing.

“Revolving Borrowing” means a borrowing consisting of simultaneous Revolving Advances made by each Lender to a Borrower pursuant to Section 2.01(c).

“Revolving Commitment” means, for each Lender, its obligation to (a) make Revolving Advances to the Borrowers pursuant to Section 2.01, and (b) purchase participations in L/C Obligations pursuant to Section 2.14(b), each in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender’s name on Annex I or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement.

“Revolving Tranche 1 Advance” means any Revolving Advance by a Lender to Borrower 1.

“Revolving Tranche 2 Advance” means any Revolving Advance by a Lender to Borrower 2.

“Revolving Tranche 3 Advance” means any Revolving Advance by a Lender to Borrower 3.

“Revolving Tranche 4 Advance” means any Revolving Advance by a Lender to Borrower 4.

“Rig” means any of Rig 1, Rig 2, Rig 3 or Rig 4, and “Rigs” means all such Rigs collectively.

“Rig 1” means the Baker Marine Pacific Class 375 ultra-premium jackup drilling rig hull number P2018, including the related machinery, equipment and gear, including without limitation any OFE.

“Rig 1 Construction Contract” means the Rig Construction Contract (P2018) dated as of January 10, 2007 between Bluesky and the Shipyard, as supplemented by the Supplemental Agreement to Rig Construction Contract dated January 10, 2007 between Bluesky and Shipyard and as modified by the Novation Agreement dated as of  August 30, 2007 among Bluesky, the Shipyard and OGIL, the Forbearance Agreement dated as of November 16, 2007 between OGIL and the Shipyard, the Supplemental Forbearance Agreement dated as of March 24, 2008 between OGIL and the Shipyard and the Third Forbearance Agreement dated as of May 10, 2008 between OGIL and the Shipyard.

“Rig 1 Delivery Date” means the date upon which Rig 1 is delivered by the Shipyard to Borrower 1 completed in accordance with the terms of the Rig 1 Construction Contract, expected to be December 28, 2008, but not later than March 31, 2009.

“Rig 1 Maturity Date” means the earlier of (a) the date that is seven (7) years and three (3) months after the Rig 1 Delivery Date and (b) the Final Maturity Date.

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“Rig 2” means the Baker Marine Pacific Class 375 ultra-premium jackup drilling rig hull number P2017, including the related machinery, equipment and gear, including without limitation any OFE.

“Rig 2 Construction Contract” means the Rig Construction Contract (P2017) dated as of October 27, 2006 between Bluesky and the Shipyard, as modified by the Novation Agreement dated as of August 30, 2007 among Bluesky, the Shipyard and OGIL and the Forbearance Agreement dated as of May 10, 2008 between OGIL and the Shipyard.

“Rig 2 Delivery Date” means the date upon which Rig 2 is delivered by the Shipyard to Borrower 2 completed in accordance with the terms of the Rig 2 Construction Contract, expected to be July 31, 2009, but not later than September 30, 2009.

“Rig 2 Maturity Date” means the earlier of (a) the date that is seven (7) years and three (3) months after the Rig 2 Delivery Date and (b) the Final Maturity Date.

“Rig 3” means the Baker Marine Pacific Class 375 ultra-premium jackup drilling rig hull number P2020, including the related machinery, equipment and gear, including without limitation any OFE.

“Rig 3 Construction Contract” means the Rig Construction Contract (P2020) dated as of  June 3, 2007 between Bluesky and the Shipyard, as supplemented by the Supplemental Agreement to Rig Construction Contract dated June 3, 2007 between Bluesky and Shipyard, as modified by the Novation Agreement dated as of  August 30, 2007 among Bluesky, the Shipyard and OGIL and the Forbearance Agreement dated as of May 30, 2008 between OGIL and the Shipyard.

“Rig 3 Delivery Date” means the date upon which Rig 3 is delivered by the Shipyard to Borrower 3 completed in accordance with the terms of the Rig 3 Construction Contract, expected to be September 30, 2009, but not later than December 31, 2009.

“Rig 3 Maturity Date” means the earlier of (a) the date that is seven (7) years and three (3) months after the Rig 3 Delivery Date and (b) the Final Maturity Date.

“Rig 4” means the Baker Marine Pacific Class 375 ultra-premium jackup drilling rig hull number P2021, including the related machinery, equipment and gear, including without limitation any OFE.

“Rig 4 Construction Contract” means the Rig Construction Contract (P2021) dated as of August 14, 2007 between Bluesky and the Shipyard, as supplemented by the Supplemental Agreement to Rig Construction Contract dated August 14, 2007 between Bluesky and Shipyard and as modified by the Novation Agreement dated as of August 30, 2007 among Bluesky, the Shipyard and OGIL the Forbearance Agreement dated as of March 24, 2008 between OGIL and the Shipyard and the Supplemental Forbearance Agreement dated as of May 10, 2008 between OGIL and the Shipyard.

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“Rig 4 Delivery Date” means the date upon which Rig 4 is delivered by the Shipyard to Borrower 4 completed in accordance with the terms of the Rig 4 Construction Contract, expected to be December 31, 2009, but not later than March 31, 2010.

“Rig 4 Maturity Date” means the earlier of (a) the date that is seven (7) years and three (3) months after the Rig 4 Delivery Date and (b) the Final Maturity Date.

“Rig Appraisal Report” has the meaning set forth in Section 5.06(g).

“Rig Construction Contracts” means the Rig 1 Construction Contract, the Rig 2 Construction Contract, the Rig 3 Construction Contract and the Rig 4 Construction Contract.

“Rig Mortgages” means each of the First Preferred Mortgages (or other ship mortgage, fleet mortgage, naval mortgage or other agreement, document or instrument evidencing a grant of liens in a rig or vessel) executed by any Loan Party which pledges a Rig owned by such Person to the Collateral Agent for the benefit of the Secured Parties as collateral for all or a portion of the Obligations, in form and substance reasonably acceptable to the Facility Agent and as required to create an Acceptable Security Interest.

“S&P” means Standard & Poor’s Rating Agency Group, a division of Mc-Graw Hill Companies, Inc., or any successor that is a national credit rating organization.

“SEC” means the Securities and Exchange Commission, and any successor entity.

“Secured Parties” means the Agents, the Mandated Lead Arrangers, the Joint Bookrunners, the Lenders, the Swap Counterparties and their Related Parties.

“Security Agreement” means the Security Agreement in substantially the form of Exhibit K among one or more of the Loan Parties and the Collateral Agent for the benefit of the Secured Parties.

“Security Documents” means the Assignments of Earnings, the Assignments of Insurance, the Charter Assignments, the Collateral Assignments of Rig Construction Contract, the Mortgages, the Security Agreement, the Pledge Agreement and each other document, instrument or agreement executed in connection therewith or otherwise executed in order to secure all or a portion of the Obligations.

“Security Maintenance Ratio” means, as of any date of determination and with respect to any Tranche, the ratio of (a) the Market Value of the applicable Rig as of such date and (b) the outstanding principal amount of the Advances of such Tranche as of such date.

“Shipyard” means PPL Shipyard PTE Ltd., a Singapore corporation.

“Subsidiary” of a Person means any corporation, association, partnership or other business entity of which more than 50% of the outstanding Equity Interests having by the terms thereof ordinary voting power under ordinary circumstances to elect a majority of the board of directors or Persons performing similar functions (or, if there are no such directors or Persons, having general voting power) of such entity (irrespective of whether at the time Equity Interests

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of any other class or classes of such entity shall or might have voting power upon the occurrence of any contingency) which entity is at the time directly or indirectly owned or controlled by such Person, by such Person and one or more Subsidiaries of such Person or by one or more Subsidiaries of such Person.

“Super-Majority Lenders” means, as of any date of determination, (a) before all of the Commitments terminate, Lenders holding more than 80% of the then aggregate Revolving Commitments, Unused Term Commitments, Unused Top-Up Commitments, unpaid principal amount of the Term Advances and the Top-Up Advances and (b) thereafter, Lenders holding more than 80% of the aggregate unpaid principal amount of the Advances and participation interests in the Letter of Credit Exposure at such time.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

“Swap Counterparty” means any Lender or any Affiliate thereof that is party to a Swap Contract with any Loan Party and is otherwise acceptable to the Facility Agent.

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

“Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of Property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

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“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Technical Advisor” means Noble Denton, Moonpool, DNV Advisory Services, or another marine surveyor retained by the Facility Agent at the Borrower’s expense.

“Term Advance” means any Term Tranche 1 Advance, Term Tranche 2 Advance, Term Tranche 3 Advance or Term Tranche 4 Advance.

“Term Borrowing” means any Term Tranche 1 Borrowing, Term Tranche 2 Borrowing, Term Tranche 3 Borrowing or Term Tranche 4 Borrowing.

“Term Commitment” means, for each Lender, such Lender’s Term Tranche 1 Commitment, Term Tranche 2 Commitment, Term Tranche 3 Commitment and Term Tranche 4 Commitment.

“Term Tranche 1 Advance” means any advance by a Lender to Borrower 1 as part of a Term Tranche 1 Borrowing.

“Term Tranche 1 Borrowing” means a borrowing consisting of simultaneous Term Tranche 1 Advances made by each Lender pursuant to Section 2.01(a)(i).

“Term Tranche 1 Commitment” means, for each Lender, the commitment of such Lender to make Term Tranche 1 Advances to Borrower 1 in the maximum aggregate amount set forth on Annex I opposite such Lender’s name as its Term Tranche 1 Commitment.  The aggregate Term Tranche 1 Commitments as of the Effective Date are $80,000,000.

“Term Tranche 2 Advance” means any advance by a Lender to Borrower 2 as part of a Term Tranche 2 Borrowing.

“Term Tranche 2 Borrowing” means a borrowing consisting of simultaneous Term Tranche 2 Advances made by each Lender pursuant to Section 2.01(a)(ii).

“Term Tranche 2 Commitment” means, for each Lender, the commitment of such Lender to make Term Tranche 2 Advances to Borrower 2 in the maximum aggregate amount set forth on Annex I opposite such Lender’s name as its Term Tranche 2 Commitment.  The aggregate Term Tranche 2 Commitments as of the Effective Date are $80,000,000.

“Term Tranche 3 Advance” means any advance by a Lender to Borrower 3 as part of a Term Tranche 3 Borrowing.

“Term Tranche 3 Borrowing” means a borrowing consisting of simultaneous Term Tranche 3 Advances made by each Lender pursuant to Section 2.01(a)(iii).

“Term Tranche 3 Commitment” means, for each Lender, the commitment of such Lender to make Term Tranche 3 Advances to Borrower 3 in the maximum aggregate amount set forth on

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Annex I opposite such Lender’s name as its Term Tranche 3 Commitment.  The aggregate Term Tranche 3 Commitments as of the Effective Date are $80,000,000.

“Term Tranche 4 Advance” means any advance by a Lender to Borrower 4 as part of a Term Tranche 4 Borrowing.

“Term Tranche 4 Borrowing” means a borrowing consisting of simultaneous Term Tranche 4 Advances made by each Lender pursuant to Section 2.01(a)(iv).

“Term Tranche 4 Commitment” means, for each Lender, the commitment of such Lender to make Term Tranche 4 Advances to Borrower 4 in the maximum aggregate amount set forth on Annex I opposite such Lender’s name as its Term Tranche 4 Commitment.  The aggregate Term Tranche 4 Commitments as of the Effective Date are $80,000,000.

“TMT” means TMT Co., Ltd., a company incorporated in the Republic of Taiwan.

“TMT Guaranties” means (a) Letter of Guarantee dated as of October 27, 2006, as supplemented by the Letter of Guarantee dated as of  August 30, 2007,  in connection with the Rig 1 Construction Contract, (b) the Performance Guaranty dated as of  January 10, 2007 in connection with the Rig 2 Construction Contract, (c) Performance Guarantee dated as of  June 3, 2007 in connection with the Rig 3 Construction Contract and (d) Performance Guarantee dated as of  August 14, 2007, as supplemented by the Performance Guarantee dated as of  August 30, 2007, each in connection with the Rig 4 Construction Contract.

“Top-Up Advance” means any Top-Up Tranche 1 Advance, Top-Up Tranche 2 Advance, Top-Up Tranche 3 Advance or Top-Up Tranche 4 Advance.

“Top-Up Borrowing” means any Top-Up Tranche 1 Borrowing, Top-Up Tranche 2 Borrowing, Top-Up Tranche 3 Borrowing or Top-Up Tranche 4 Borrowing.

“Top-Up Commitment” means, for each Lender, such Lender’s Top-Up Tranche 1 Commitment, Top-Up Tranche 2 Commitment, Top-Up Tranche 3 Commitment and Top-Up Tranche 4 Commitment.

“Top-Up Tranche 1 Advance” means any advance by a Lender to Borrower 1 as part of a Top-Up Tranche 1 Borrowing.

“Top-Up Tranche 1 Borrowing” means a borrowing consisting of simultaneous Top-Up Tranche 1 Advances made by each Lender pursuant to Section 2.01(b)(i).

“Top-Up Tranche 1 Commitment” means, for each Lender, the commitment of such Lender to make Top-Up Tranche 1 Advances to Borrower 1 in the maximum aggregate amount set forth on Annex I opposite such Lender’s name as its Top-Up Tranche 1 Commitment.  The aggregate Top-Up Tranche 1 Commitments as of the Effective Date are $20,000,000.

“Top-Up Tranche 2 Advance” means any advance by a Lender to Borrower 2 as part of a Top-Up Tranche 2 Borrowing.

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“Top-Up Tranche 2 Borrowing” means a borrowing consisting of simultaneous Top-Up Tranche 2 Advances made by each Lender pursuant to Section 2.01(b)(ii).

“Top-Up Tranche 2 Commitment” means, for each Lender, the commitment of such Lender to make Top-Up Tranche 2 Advances to Borrower 2 in the maximum aggregate amount set forth on Annex I opposite such Lender’s name as its Top-Up Tranche 2 Commitment.  The aggregate Top-Up Tranche 2 Commitments as of the Effective Date are $20,000,000.

“Top-Up Tranche 3 Advance” means any advance by a Lender to Borrower 3 as part of a Top-Up Tranche 3 Borrowing.

“Top-Up Tranche 3 Borrowing” means a borrowing consisting of simultaneous Top-Up Tranche 3 Advances made by each Lender pursuant to Section 2.01(b)(iii).

“Top-Up Tranche 3 Commitment” means, for each Lender, the commitment of such Lender to make Top-Up Tranche 3 Advances to Borrower 3 in the maximum aggregate amount set forth on Annex I opposite such Lender’s name as its Top-Up Tranche 3 Commitment.  The aggregate Top-Up Tranche 3 Commitments as of the Effective Date are $20,000,000.

“Top-Up Tranche 4 Advance” means any advance by a Lender to Borrower 4 as part of a Top-Up Tranche 4 Borrowing.

“Top-Up Tranche 4 Borrowing” means a borrowing consisting of simultaneous Top-Up Tranche 4 Advances made by each Lender pursuant to Section 2.01(b)(iv).

“Top-Up Tranche 4 Commitment” means, for each Lender, the commitment of such Lender to make Top-Up Tranche 4 Advances to Borrower 4 in the maximum aggregate amount set forth on Annex I opposite such Lender’s name as its Top-Up Tranche 4 Commitment.  The aggregate Top-Up Tranche 4 Commitments as of the Effective Date are $20,000,000.

“Total Cost” means, with respect to any Rig, the sum of the Contract Price (as set forth in the applicable Rig Construction Contract) and the Additional Costs.

“Total Loss” means (a) the actual, constructive, arranged, agreed, or compromised total loss of any Rig; (b) the loss, theft or destruction of such Rig or damage thereto to such extent as shall make repair thereof uneconomical or shall render such Rig permanently unfit for normal use for any reason whatsoever; (c) the requisition for title or other compulsory acquisition or forfeiture of any Rig otherwise than by requisition for hire; or (d) the capture, condemnation, seizure, arrest, detention or confiscation of any Rig by any Governmental Authority or by Persons acting or purporting to act on behalf of any Governmental Authority unless such Rig be released from such capture, seizure, arrest, detention or confiscation within one (1) month after the occurrence thereof.

“Tranche” means any Class of Commitments or Advances, whether such Advances or Commitments are Tranche 1 Advances, Tranche 2 Advances, Tranche 3 Advances or Tranche 4 Advances or Tranche 1 Commitments, Tranche 2 Commitments, Tranche 3 Commitments or Tranche 4 Commitments, as the case may be.

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“Tranche 1 Advances” means any Revolving Tranche 1 Advance, Term Tranche 1 Advance, or Top-Up Tranche 1 Advance.

“Tranche 2 Advances” means any Revolving Tranche 2 Advance, Term Tranche 2 Advance, or Top-Up Tranche 2 Advance.

“Tranche 3 Advances” means any Revolving Tranche 3 Advance, Term Tranche 3 Advance, or Top-Up Tranche 3 Advance.

“Tranche 4 Advances” means any Revolving Tranche 4 Advance, Term Tranche 4 Advance, or Top-Up Tranche 4 Advance.

“Tranche 1 Commitment” means any Term Tranche 1 Commitment or Top-Up Tranche 1 Commitment.

“Tranche 2 Commitment” means any Term Tranche 2 Commitment or Top-Up Tranche 2 Commitment.

“Tranche 3 Commitment” means any Term Tranche 3 Commitment or Top-Up Tranche 3 Commitment.

“Tranche 4 Commitment” means any Term Tranche 4 Commitment or Top-Up Tranche 4 Commitment.

“Transactions” means the Vantage Acquisition and each of the other transactions contemplated by the Transaction Documents.

“Transaction Documents” means (a) the Share Purchase Agreement dated as of August 30, 2007 among Vantage Energy, F3 Capital, and OGIL, as amended by Amendment No. 1 dated as of December 3, 2007 among Vantage Energy, F3 Capital, OGIL and the Parent, (b) each other material document executed on or before the Effective Date with respect to the Vantage Acquisition, and (c) the Rig Construction Contracts.

“Transfer Agreement” means any agreement pursuant to which any Vendor Agreement is assigned or novated to OGIL.

“UCC” means the Uniform Commercial Code as in effect on the date hereof in the State of New York, as amended from time to time, and any successor statute.

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

“Unused Revolving Commitments” means, with respect to any Tranche, the difference between (a) the Revolving Commitments of such Tranche and (b) the sum of the Revolving Advances of such Tranche and the Letter of Credit Exposure of such Tranche.

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“Unused Term Commitments” means the difference between (a) the Term Commitments and (b) the Term Advances.

“Unused Top-Up Commitments” means the difference between (a) the Top-Up Commitments and (b) the Top-Up Advances.

“Vantage Acquisition” means the acquisition by the Parent of all of the outstanding shares of common stock of OGIL pursuant to the Transaction Documents.

“Vantage Deepwater” means Vantage Deepwater Company, a Cayman Islands exempted company.

“Vantage Driller I” means Vantage Driller I Co, a Cayman Islands exempted company.

“Vantage Driller II” means Vantage Driller II Co, a Cayman Islands exempted company.

“Vantage Energy” means Vantage Energy Services, Inc., a Delaware corporation.

“Vantage Int’l Payroll (Singapore)” means Vantage International Payroll Company Pte. Ltd., a company formed under the laws of Singapore.

“Vantage Int’l Payroll (Caymans)” means Vantage International Payroll Co., a Cayman Islands exempted company.

“Vantage US Payroll” means Vantage US Payroll Company Pte. Ltd., a company formed under the laws of Singapore.

“Vantage Int’l Management (Caymans)” means Vantage International Management Co., a Cayman Islands exempted company.

“Vantage Int’l Management (Singapore)” means Vantage International Management Company, a company formed under the laws of Singapore.

“Vendor Agreement” means any agreement between Bluesky and the suppliers named therein for the provision of certain drilling equipment to Bluesky which is to be furnished to the Shipyard for installation in the Rigs, to be novated or assigned to OGIL pursuant to a Transfer Agreement.

“Voting Stock” means, with respect to any Person, securities of any class or classes of Equity Interests or other interests (including partnership interests) in such Person entitling the holders thereof (whether at all times or at the time that such class of Equity Interests has voting power by reason of the happening of any contingency) to vote in the election of members of the board of directors or comparable body of such Person.

“Working Capital Ratio” means, at any date of determination, the ratio of (a) the consolidated current assets of the Borrowers and their Subsidiaries determined in accordance with GAAP on such date to (b) the consolidated current liabilities of the Borrowers and their

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Subsidiaries at such time determined in accordance with GAAP minus the current portion of any Debt under this Agreement to the extent otherwise included therein.

Section 1.02           Computation of Time Periods.  In this Agreement in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each means “to but excluding”.

Section 1.03           Accounting Terms.

(a)           For purposes of this Agreement, all accounting terms not otherwise defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time.

(b)           If at any time any Accounting Change (as defined below) would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Parent or the Majority Lenders shall so request, the Facility Agent, the Lenders and the Parent shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Majority Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Parent shall provide to the Facility Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.  “Accounting Changes” means: (A) changes in accounting principles required by GAAP and implemented by the Parent; (B) changes in accounting principles recommended by the Parent’s accountants; and (C) changes in carrying value of Parent’s or any of its Subsidiaries’ assets, liabilities or equity accounts resulting from (i) the application of purchase accounting principles to the Parent’s acquisition of OGIL from F3 Capital or (ii) any other adjustments that, in each case, were applicable to, but not included in, the Pro Forma Financial Statements.

(c)           In addition, all calculations and defined accounting terms used herein shall, unless expressly provided otherwise, when referring to any Person, refer to such Person on a consolidated basis and mean such Person and its consolidated subsidiaries.

Section 1.04           Classes of Advances.  Advances are distinguished by “Class”.  The “Class” of an Advance refers to the determination of whether such Advance is a Term Advance, Revolving Advance or Top-Up Advance, each of which constitutes a Class.

Section 1.05           Miscellaneous.  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise

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modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (e) any reference to any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time and (f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

ARTICLE II
THE CREDIT FACILITIES

Section 2.01           The Advances.

(a)           Term Advances.

(i)            Term Tranche 1 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make up to four Term Tranche 1 Advances to Borrower 1 from time-to-time on any Business Day during the period from the Effective Date until the Rig 1 Delivery Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Term Tranche 1 Commitment and (B) such Lender’s Pro Rata Share of 36% of the Total Cost of Rig 1.  Each Term Tranche 1 Borrowing shall be in an aggregate amount not less than $10,000,000 and in integral multiples of $1,000,000 in excess thereof.  Each Term Tranche 1 Borrowing shall correspond to the applicable installment of the Contract Price (as defined in the Rig 1 Construction Contract) as set forth on Schedule 2.01.  Principal payments made after the Effective Date may not be reborrowed.

(ii)           Term Tranche 2 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make up to four Term Tranche 2 Advances to Borrower 2 from time-to-time on any Business Day during the period from the Effective Date until the Rig 2 Delivery Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Term Tranche 2 Commitment and (B) such Lender’s Pro Rata Share of 36% of the Total Cost of Rig 2.  Each Term Tranche 2 Borrowing shall be in an aggregate amount not less than $10,000,000 and in integral multiples of $1,000,000 in excess thereof.  Each Term Tranche 2 Borrowing shall correspond to the applicable installment of the Contract Price (as defined in the Rig 2 Construction Contract) as set forth on Schedule 2.01.  Principal payments made after the Effective Date may not be reborrowed.

(iii)          Term Tranche 3 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make up to four Term Tranche 3 Advances

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to Borrower 3 from time-to-time on any Business Day during the period from the Effective Date until the Rig 3 Delivery Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Term Tranche 3 Commitment and (B) such Lender’s Pro Rata Share of 36% of the Total Cost of Rig 3.  Each Term Tranche 3 Borrowing shall be in an aggregate amount not less than $10,000,000 and in integral multiples of $1,000,000 in excess thereof.  Each Term Tranche 3 Borrowing shall correspond to the applicable installment of the Contract Price (as defined in the Rig 3 Construction Contract) as set forth on Schedule 2.01.  Principal payments made after the Effective Date may not be reborrowed.

(iv)          Term Tranche 4 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make up to four Term Tranche 4 Advances to Borrower 4 from time-to-time on any Business Day during the period from the Effective Date until the Rig 4 Delivery Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Term Tranche 4 Commitment and (B) such Lender’s Pro Rata Share of 36% of the Total Cost of Rig 4.  Each Term Tranche 4 Borrowing shall be in an aggregate amount not less than $10,000,000 and in integral multiples of $1,000,000 in excess thereof.  Each Term Tranche 4 Borrowing shall correspond to the applicable installment of the Contract Price (as defined in the Rig 4 Construction Contract) as set forth on Schedule 2.01.  Principal payments made after the Effective Date may not be reborrowed.

(b)           Top-Up Advances.

(i)            Top-Up Tranche 1 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make Top-Up Tranche 1 Advances to Borrower 1 from time-to-time on any Business Day during the period from the Rig 1 Delivery Date to the Rig 1 Maturity Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Top-Up Tranche 1 Commitment and (B) 9% of the Total Cost of Rig 1.  Each Top-Up Tranche 1 Borrowing shall be in an aggregate amount not less than $1,000,000 and in integral multiples thereof.  Principal payments made after the Rig 1 Delivery Date may not be reborrowed.

(ii)           Top-Up Tranche 2 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make Top-Up Tranche 2 Advances to Borrower 2 from time-to-time on any Business Day during the period from the Rig 2 Delivery Date to the Rig 2 Maturity Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Top-Up Tranche 2 Commitment and (B) 9% of the Total Cost of Rig 2.  Each Top-Up Tranche 2 Borrowing shall be in an aggregate amount not less than $1,000,000 and in integral multiples thereof.  Principal payments made after the Rig 2 Delivery Date may not be reborrowed.

(iii)          Top-Up Tranche 3 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make Top-Up Tranche 3 Advances to Borrower 3 from time-to-time on any Business Day during the period from the Rig 3 Delivery Date to the Rig 3 Maturity Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Top-Up Tranche 3 Commitment and (B) 9% of the

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Total Cost of Rig 3.  Each Top-Up Tranche 3 Borrowing shall be in an aggregate amount not less than $1,000,000 and in integral multiples thereof.  Principal payments made after the Rig 3 Delivery Date may not be reborrowed.

(iv)          Top-Up Tranche 4 Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make Top-Up Tranche 4 Advances to Borrower 4 from time-to-time on any Business Day during the period from the Rig 4 Delivery Date to the Rig 4 Maturity Date in an aggregate amount up to but not to exceed the lesser of (A) the amount of its Top-Up Tranche 4 Commitment and (B) 9% of the Total Cost of Rig 4.  Each Top-Up Tranche 4 Borrowing shall be in an aggregate amount not less than $1,000,000 and in integral multiples thereof.  Principal payments made after the Rig 4 Delivery Date may not be reborrowed.

(c)           Revolving Advances.  Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make Revolving Advances to any Borrower from time-to-time on any Business Day during the period from the Rig 1 Delivery Date until the Final Maturity Date in a maximum amount up to but not to exceed at any time outstanding its Revolving Commitment; provided however that the aggregate outstanding principal amount of the sum of (i) all Revolving Advances plus (ii) the Letter of Credit Exposure shall not exceed at any time (A) on or before the Rig 2 Delivery Date, $10,000,000, (B) on or before the Rig 3 Delivery Date, $20,000,000, (C) on or before the Rig 4 Delivery Date, $30,000,000, and (D) thereafter, the Aggregate Revolving Commitments.  Each Revolving Borrowing shall be in an aggregate amount not less than $1,000,000 and in integral multiples thereof.  Within the limits of each Lender’s Revolving Commitment, the Borrowers may from time-to-time borrow, prepay pursuant to Section 2.07(b) and reborrow under this Section 2.01(c).

Section 2.02           Method of Borrowing.

(a)           Notice.  Each Borrowing shall be made pursuant to a Notice of Borrowing, given not later than 10:00 a.m. (Paris, France time) on the third Business Day before the requested Borrowing Date, in each case to the Facility Agent’s Applicable Lending Office.  The Facility Agent shall give to each Lender prompt notice on the day of receipt of a timely Notice of Borrowing.  The Notice of Borrowing shall be in writing specifying (A) the Borrowing Date (which shall be a Business Day), (B) the requested Class and Tranche of Advances comprising such Borrowing, (C) the aggregate amount of such Borrowing, (D) the requested Interest Period and (E) the applicable Borrower.  The Facility Agent shall promptly notify each Lender of the applicable interest rate under Section 2.06(a)(i) or (ii).  Each Lender shall make available its Pro Rata Share of such Borrowing before 12:00 p.m. (New York time) on the Borrowing Date in immediately available funds to the Facility Agent at its Applicable Lending Office or such other location as the Facility Agent may specify by notice to the Lenders.  After the Facility Agent’s receipt of such funds and upon fulfillment of the applicable conditions set forth in Article III, the Facility Agent will promptly make such funds available to the applicable Borrower not later than 2:00 p.m. (New York time) at such account as such Borrower shall specify in writing to the Facility Agent.

(b)           Continuations.  In order to elect to Continue a Borrowing under this Section, the applicable Borrower shall deliver an irrevocable Notice of Continuation to the Facility Agent at

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its Applicable Lending Office no later than 10:00 a.m. (Paris, France time) at least three Business Days in advance of such requested Continuation.  Each such Notice of Continuation shall be in writing or by telex, telecopier or telephone, confirmed promptly in writing specifying (A) the requested Continuation date (which shall be a Business Day), (B) the amount, Class and Tranche of the Advances comprising the Borrowing to be Continued, and (C) the requested Interest Period.  Promptly after receipt of a Notice of Continuation under this paragraph, the Facility Agent shall provide each Lender with a copy thereof and notify each Lender of the interest rate under Sections 2.06(a)(i) or (ii).

(c)           Certain Limitations.  Notwithstanding anything in paragraphs (a) and (b) above:

(i)            at no time shall there be more than two Interest Periods applicable to each Class and each Tranche of outstanding Eurodollar Advances;

(ii)           if the Facility Agent is unable to determine the Eurodollar Rate for any requested Borrowing and the Facility Agent gives telephonic or telecopy notice thereof to the Borrowers as soon as practicable, the right of any Borrower to select Eurodollar Advances for any subsequent Borrowing and the obligation of the Lenders to make such Eurodollar Advances shall be suspended until the Facility Agent shall notify the Borrowers and the Lenders that the circumstances causing such suspension no longer exist, and each Advance comprising such Borrowing shall be a Base Rate Advance;

(iii)          if the Majority Lenders shall, by 11:00 a.m. (New York time) at least one Business Day before the date of any requested Borrowing, notify the Facility Agent that the Eurodollar Rate will not adequately reflect the cost to such Lenders of making or funding their respective Eurodollar Advances and the Facility Agent gives telephonic or telecopy notice thereof to the Borrowers as soon as practicable, the right of any Borrower to select Eurodollar Advances for such Borrowing or for any subsequent Borrowing and the obligation of the Lenders to make Eurodollar Advances shall be suspended until the Facility Agent shall notify the Borrowers and the Lenders that the circumstances causing such suspension no longer exist, and each Advance comprising such Borrowing shall be a Base Rate Advance;

(iv)          if any Borrower shall fail to select the duration or Continuation of any Interest Period for any Eurodollar Advances in accordance with the provisions contained in the definition of “Interest Period” in Section 1.01 and paragraphs (a) and (b) above or shall fail to deliver a Notice of Continuation, the Facility Agent will forthwith so notify such Borrower and the Lenders and such Borrower shall be deemed to have selected an Interest Period of one month’s duration; and

(v)           at any time when a Default or an Event of Default has occurred and is continuing, no Borrower may select an Interest Period for any Eurodollar Advance longer than one month’s duration; provided, however that no Borrower shall be requested to prepay (or convert to an Adjusted Base Rate) any existing Eurodollar Borrowing prior to the end of the Interest Period for such Borrowing.

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(d)           Notices Irrevocable.  Each Notice of Borrowing and each Notice of Continuation delivered by a Borrower shall be irrevocable and binding on such Borrower.  In the case of the initial Borrowing or any Borrowing which the related Notice of Continuation specifies is to be comprised of Eurodollar Advances, each Borrower shall indemnify each Lender against any loss, out-of-pocket cost or expense actually incurred by such Lender as a result of any failure to fulfill on or before the Borrowing Date or the date specified in such Notice of Continuation for such Borrowing the applicable conditions set forth in Article III, including, without limitation, any loss, cost or expense actually incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund the Advance to be made by such Lender as part of such Borrowing when such Advance, as a result of such failure, is not made on such date.

(e)           Facility Agent Reliance.  Unless the Facility Agent shall have received notice from a Lender before the Borrowing Date that such Lender will not make available to the Facility Agent such Lender’s Pro Rata Share of the Borrowing, the Facility Agent may assume that such Lender has made its Pro Rata Share of such Borrowing available to the Facility Agent on the Borrowing Date in accordance with paragraph (a) of this Section 2.02 and the Facility Agent may, in reliance upon such assumption, make available to the applicable Borrower on the Borrowing Date a corresponding amount.  If and to the extent that such Lender shall not have so made its Pro Rata Share of such Borrowing available to the Facility Agent, such Lender and the applicable Borrower severally agree to immediately repay to the Facility Agent on demand such corresponding amount, together with interest on such amount, for each day from the date such amount is made available to such Borrower until the date such amount is repaid to the Facility Agent, at (i) in the case of a Borrower, the interest rate applicable on such day to Eurodollar Advances and (ii) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Facility Agent in accordance with banking industry rules on interbank compensation.  If such Lender shall repay to the Facility Agent such corresponding amount and interest as provided above, such corresponding amount so repaid shall constitute such Lender’s Advance as part of such Borrowing for purposes of this Agreement even though not made on the same day as the other Advances comprising such Borrowing.  If such Lender’s Advance as part of such Borrowing is not made available by such Lender within three Business Days of the Borrowing Date, the applicable Borrower shall repay such Lender’s share of such Borrowing (together with interest thereon at the interest rate applicable during such period to Eurodollar Advances) to the Facility Agent not later than three Business Days after receipt of written notice from the Facility Agent specifying such Lender’s share of such Borrowing that was not made available to the Facility Agent.

(f)            Lender Obligations Several.  The failure of any Lender to make an Advance to be made by it as part of any Borrowing shall not relieve any other Lender of its obligation, if any, to make its Advance on the applicable Borrowing Date.  No Lender shall be responsible for the failure of any other Lender to make an Advance to be made by such other Lender on any applicable Borrowing Date.

(g)           Noteless Agreement; Evidence of Indebtedness.

(i)            Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrowers to such Lender resulting from the Advances made by such Lender from time to time, including the

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amounts of principal and interest payable and paid to such Lender from time to time hereunder.

(ii)           The Facility Agent shall also maintain accounts in which it will record (A) the amount of each Advance made hereunder and the Class and Tranche thereof and the Interest Period with respect thereto, (B) the amount of any principal or interest due and payable or to become due and payable from each Borrower to each Lender hereunder and (C) the amount of any sum received by the Facility Agent hereunder from each Borrower and each Lender’s share thereof.

(iii)          The entries maintained in the accounts maintained pursuant to paragraphs (i) and (ii) above shall be prima facie evidence of the existence and amounts of the Obligations therein recorded; provided, however, that the failure of the Facility Agent or any Lender to maintain such accounts or any error therein shall not in any manner affect the obligation of any Borrower to repay the Obligations in accordance with their terms.

(iv)          Any Lender may request that the Advances owing to such Lender be evidenced by a promissory note (a “Note”).  In such event, the applicable Borrower shall execute and deliver to such Lender a Note payable to the order of such Lender and its registered assigns and in form and substance reasonably acceptable to the Facility Agent and such Borrower.  Thereafter, the Advances evidenced by such Note and interest thereon shall at all times (including after any assignment pursuant to Section 10.06) be represented by one or more Notes payable to the order of the payee named therein or any assignee pursuant to Section 10.06, except to the extent that any such Lender or assignee subsequently returns any such Note for cancellation and requests that such Advances once again be evidenced as described in paragraphs (i) and (ii) above.

Section 2.03           Fees.

(a)           Commitment Fees.  The Borrowers jointly and severally agree to pay to the Facility Agent for the account of each Lender a commitment fee (a “Commitment Fee”) equal to the product of 0.75% per annum and the average daily amount by which such Lender’s Aggregate Commitment exceeds the sum of (i) the aggregate principal amount of such Lender’s outstanding Advances and (ii) such Lender’s Pro Rata Share of the Letter of Credit Exposure, from the Effective Date until the Final Maturity Date.  The Commitment Fees payable pursuant to this clause (a) are due quarterly in arrears on the last Business Day of each March, June, September and December commencing on the first such date occurring after the Effective Date and continuing thereafter through and including the Final Maturity Date.

(b)           Agency and Arrangement Fees.  The Borrowers jointly and severally agree to pay to the Agents and the Joint Bookrunners the fees as separately agreed upon in the Fee Letters.

(c)           Letter of Credit Fees.

(i)            The Borrowers jointly and severally agree to pay to the Facility Agent for the pro rata benefit of each Lender a letter of credit fee at a per annum rate equal to the Applicable Margin in effect from time to time.  Each such fee shall be based on the maximum amount available to be drawn under such Letter of Credit from the date of

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issuance of the Letter of Credit until its expiration date and shall be payable quarterly in arrears on the last Business Day of each March, June, September and December until the earlier of its expiration date or the Final Maturity Date.  All such fees shall be computed on the basis of the actual number of days elapsed in a year of 360 days.

(ii)           The Borrowers jointly and severally agree to pay to the applicable Issuing Bank, a fronting fee for each Letter of Credit issued for its account equal to 0.125% per annum of the initial stated amount of such Letter of Credit (or, with respect to any subsequent increase to the stated amount of any such Letter of Credit, such increase in the stated amount).  Each such fee shall be payable annually in advance on the date of issuance (or subsequent increase) of such Letter of Credit and each year thereafter until the earlier of its expiration date or the Final Maturity Date.  All such fees shall be computed on the basis of a year of 360 days.

(iii)          In addition, the Borrowers jointly and severally agree to pay to the Issuing Banks all customary transaction costs and fees charged by such Issuing Bank in connection with the issuance, amendment, renewal or extension of a Letter of Credit or processing of drawings thereunder, such costs and fees to be due and payable on the date specified by the applicable Issuing Bank in the invoice for such costs and fees.

(d)           Generally.  All such fees shall be paid on the dates due, in immediately available Dollars to the Facility Agent for distribution, if and as appropriate, among the Lenders, except that the fees payable pursuant to (i) Section 2.03(b) shall be paid directly to the applicable Agent or Joint Bookrunner and (ii) Section 2.03(c)(ii) and (iii) shall be paid directly to the applicable Issuing Bank.  Once paid, absent manifest error, none of these fees shall be refundable under any circumstances.

Section 2.04           Reduction of the Commitments.

(a)           Optional.  Each Borrower shall have the right, upon at least five days’ irrevocable notice to the Facility Agent, to terminate in whole or reduce ratably in part the unused portion of any Class and Tranche of Commitment; provided that each partial reduction of any Commitment shall be in the minimum aggregate amount of $5,000,000 and in integral multiples of $1,000,000 in excess thereof (or such lesser amount as may then be outstanding); provided further that the Aggregate Revolving Commitments may not be reduced below the aggregate principal amount of the outstanding Revolving Advances plus the outstanding Letter of Credit Exposure.

(b)           Mandatory.  Without duplication of any mandatory reduction of the Commitments required pursuant to Section 2.07(c)(vi), upon the Collateral Disposition of any Rig, the Class and Tranche of Commitments related to such Rig shall automatically and permanently terminate and the Revolving Commitments shall automatically and permanently be reduced by $10,000,000.

In connection with any termination of any Class and Tranche of Commitment hereunder, the Borrower shall pay on the effective date of such termination any amounts, if any, required to be paid pursuant to Section 2.07(d) as a result of such termination being made on such date.  Any reduction or termination of the Commitments pursuant to Section 2.04 shall be permanent, with

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no obligation of the Lenders to reinstate such Commitments and the commitment fees provided for in Section 2.03(a) shall thereafter be computed on the basis of the Commitments as so reduced.  The Facility Agent shall give each Lender prompt notice of any commitment reduction or termination.

Section 2.05           Repayment.

(a)           Term Advances.

(i)            Term Tranche 1 Advances.  The aggregate principal amount of the Term Tranche 1 Advances shall be payable by Borrower 1 in quarterly installments equal to $2,000,000 on each of the first twenty-eight (28) consecutive quarterly Payment Dates commencing six (6) months after the Rig 1 Delivery Date.  Any remaining outstanding Term Tranche 1 Advances shall be paid in full by Borrower 1 on the Rig 1 Maturity Date.

(ii)           Term Tranche 2 Advances.  The aggregate principal amount of the Term Tranche 2 Advances shall be payable by Borrower 2 in quarterly installments equal to $2,000,000 on each of the first twenty-eight (28) consecutive quarterly Payment Dates commencing six (6) months after the Rig 2 Delivery Date.  Any remaining outstanding Term Tranche 2 Advances shall be paid in full by Borrower 2 on the Rig 2 Maturity Date.

(iii)          Term Tranche 3 Advances.  The aggregate principal amount of the Term Tranche 3 Advances shall be payable by Borrower 3 in quarterly installments equal to $2,000,000 on each of the first twenty-eight (28) consecutive quarterly Payment Dates commencing six (6) months after the Rig 3 Delivery Date.  Any remaining outstanding Term Tranche 3 Advances shall be paid in full by Borrower 3 on the Rig 3 Maturity Date.

(iv)          Term Tranche 4 Advances.  The aggregate principal amount of the Term Tranche 4 Advances shall be payable by Borrower 4 in quarterly installments equal to $2,000,000 on each of the first twenty-eight (28) consecutive quarterly Payment Dates commencing six (6) months after the Rig 4 Delivery Date.  Any remaining outstanding Term Tranche 4 Advances shall be paid in full by Borrower 4 on the Rig 4 Maturity Date.

(b)           Top-Up Advances.

(i)            Top-Up Tranche 1 Advances.  The aggregate principal amount of the Top-Up Tranche 1 Advances shall be payable in equal quarterly installments determined by the Facility Agent (and the Facility Agent shall promptly notify each Lender of such amortization schedule) on each of the consecutive quarterly Payment Dates occurring during the tenor of the applicable Drilling Contract pursuant to which such Top-Up Tranche 1 Advances were made.

(ii)           Top-Up Tranche 2 Advances.  The aggregate principal amount of the Top-Up Tranche 2 Advances shall be payable in equal quarterly installments determined by the Facility Agent (and the Facility Agent shall promptly notify each Lender of such amortization schedule) on each of the consecutive quarterly Payment Dates occurring during the tenor of the applicable Drilling Contract pursuant to which such Top-Up Tranche 2 Advances were made.

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(iii)          Top-Up Tranche 3 Advances.  The aggregate principal amount of the Top-Up Tranche 3 Advances shall be payable in equal quarterly installments determined by the Facility Agent (and the Facility Agent shall promptly notify each Lender of such amortization schedule) on each of the consecutive quarterly Payment Dates occurring during the tenor of the applicable Drilling Contract pursuant to which such Top-Up Tranche 3 Advances were made.

(iv)          Top-Up Tranche 4 Advances.  The aggregate principal amount of the Top-Up Tranche 4 Advances shall be payable in equal quarterly installments determined by the Facility Agent (and the Facility Agent shall promptly notify each Lender of such amortization schedule) on each of the consecutive quarterly Payment Dates occurring during the tenor of the applicable Drilling Contract pursuant to which such Top-Up Tranche 4 Advances were made.

(c)           Revolving Advances.  The outstanding principal amount of the Revolving Advances shall be payable by the Borrowers on the Final Maturity Date.

(d)           Notwithstanding the foregoing, any remaining outstanding Advances and all other unpaid Obligations shall be paid in full by the Borrowers on the Final Maturity Date.

(e)           In addition, the Borrower shall pay to the applicable Swap Counterparties the Swap Termination Value with respect to any Swap Contracts that terminate in whole or in part as a result of such repayments set forth above.

Section 2.06           Interest.  Each Borrower shall pay interest on the unpaid principal amount of each Advance made to such Borrower by each Lender to it from the date of such Advance until such principal amount shall be paid in full, at the following rates per annum:

(a)           Advances.

(i)            Base Rate Advances.  If such Advance is a Base Rate Advance, a rate per annum equal to the Adjusted Base Rate plus the Applicable Margin, payable in arrears on each Payment Date and on the date such Base Rate Advance shall be paid in full.

(ii)           Eurodollar Advances.  If such Advance is a Eurodollar Advance, a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Margin, payable on the last day of such Interest Period, and, in the case of Interest Periods of greater than three months, on the Business Day which occurs during such Interest Period three months from the first day of such Interest Period.

(b)           Additional Interest on Eurodollar Advances.  Each Borrower shall pay to each Lender, so long as any such Lender shall be required under regulations of the Federal Reserve Board to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency Liabilities, additional interest on the unpaid principal amount of each Eurodollar Advance made to such Borrower by such Lender, from the effective date of such Advance until such principal amount is paid in full, at an interest rate per annum equal at all times to the remainder obtained by subtracting (i) the Eurodollar Rate for the Interest Period for such Advance from (ii) the rate obtained by dividing such Eurodollar Rate by a percentage equal to

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100% minus the Eurodollar Rate Reserve Percentage of such Lender for such Interest Period, payable on each date on which interest is payable on such Advance.  Such additional interest payable to any Lender shall be determined by such Lender and notified to the Borrowers through the Facility Agent (such notice to include the calculation of such additional interest, which calculation shall be conclusive in the absence of manifest error, and be accompanied by any evidence indicating the need for such additional interest as any Borrower may reasonably request).

(c)           Usury Recapture.  In the event the rate of interest chargeable under this Agreement at any time (calculated after giving affect to all items charged which constitute “interest” under applicable laws, including fees and margin amounts, if applicable) is greater than the Maximum Rate, the unpaid principal amount of the Advances shall bear interest at the Maximum Rate until the total amount of interest paid or accrued on the Advances equals the amount of interest which would have been paid or accrued on the Advances if the stated rates of interest set forth in this Agreement had at all times been in effect.

In the event, upon payment in full of the Advances, the total amount of interest paid or accrued under the terms of this Agreement and the Advances is less than the total amount of interest which would have been paid or accrued if the rates of interest set forth in this Agreement had, at all times, been in effect, then each Borrower shall, to the extent permitted by applicable law, pay the Facility Agent for the account of the Lenders an amount equal to the difference between (i) the lesser of (A) the amount of interest which would have been charged on its Advances if the Maximum Rate had, at all times, been in effect and (B) the amount of interest which would have accrued on its Advances if the rates of interest set forth in this Agreement had at all times been in effect and (ii) the amount of interest actually paid under this Agreement on its Advances.

In the event the Lenders ever receive, collect or apply as interest any sum in excess of the Maximum Rate, such excess amount shall, to the extent permitted by law, be applied to the reduction of the principal balance of the Advances, and if no such principal is then outstanding, such excess or part thereof remaining shall be paid to the Borrower.

(d)           Default Interest.  Upon the occurrence and the during the continuance of an Event of Default, each Borrower shall on demand from time to time pay interest, to the extent permitted by law, on the outstanding Advances to but excluding the date of actual payment (after as well as before judgment) (a) in the case of overdue principal, at the rate otherwise applicable to such Advance pursuant to Section 2.06 plus 2.00% per annum and (b) in all other cases, at a rate per annum (computed on the basis of the actual number of days elapsed over a year of 360 days) equal to the rate that would be applicable to an Eurodollar Advance plus 2.00%.

Section 2.07           Prepayments.

(a)           Right to Prepay.  No Borrower shall have the right to prepay any principal amount of any Advance except as provided in this Section 2.07.

(b)           Optional Prepayments.  Any Borrower may elect to prepay, in whole or in part, any Class or Tranche of the Advances owing by it to the Lenders, after giving prior written

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notice of such election to the Facility Agent by 10:00 a.m. (Paris, France time) at least three Business Days before such prepayment stating the proposed date, aggregate principal amount, Class and Tranche of such prepayment.  If any such notice is given, the Facility Agent shall give prompt notice thereof to each Lender and such Borrower shall prepay such Class and Tranche of Advances comprising part of the same Borrowing in whole or ratably in part in an aggregate principal amount equal to the amount specified in such notice, together with accrued interest to the date of such prepayment on the principal amount prepaid and amounts, if any, required to be paid pursuant to Section 2.08 and any amounts, if any, required to be paid pursuant to Section 2.07(d) as a result of such prepayment being made on such date; provided, however, that each partial prepayment shall be in an aggregate principal amount not less than $2,000,000 and in integral multiples of $1,000,000 in excess thereof (or such lesser amount as may then be outstanding).  Optional prepayments of Term Advances and Top-Up Advances shall be applied to outstanding Advances in the inverse order of maturity of the remaining scheduled principal installments of such Tranche and Class of Advances.  In addition, the Borrower shall pay to the applicable Swap Counterparties the Swap Termination Value with respect to any Swap Contracts that terminate in whole or in part as a result of such optional prepayments set forth above.

(c)           Mandatory Prepayments.

(i)            Excess Cash Flow.  Within 45 days after the end of each fiscal quarter, beginning with the first fiscal quarter ending at least six (6) months after the Rig 1 Delivery Date, each Borrower shall prepay its outstanding Term Advances and Top-Up Advances in an amount equal to its Excess Cash Flow for such prior fiscal quarter as set forth on the Excess Cash Flow Certificate delivered to Facility Agent pursuant to Section 5.06(c).  All such prepayments from Excess Cash Flow shall be applied to in accordance with Section 2.07(c)(vi).

(ii)           Security Maintenance Ratio. If at any time any Borrower shall fail to maintain a Security Maintenance Ratio of at least 1.50 to 1.00, then as soon as possible but in any event no later than 30 days after such failure, to the extent such failure is continuing, either (A) such Borrower will, or will cause the Parent or one of its Subsidiaries (provided that such Subsidiary becomes a Loan Party pursuant to Section 5.12) to, execute and deliver to the Collateral Agent additional Rig Mortgages granting an Acceptable Security Interest in such other rigs or vessels acceptable to the Collateral Agent (acting on the instruction of the Majority Lenders) (together with any required amendments to any applicable Security Agreement and such evidence of corporate authority to enter into and such legal opinions in relation to such Security Documents as the Collateral Agent may reasonably request) that have a Market Value such that the Security Maintenance Ratio is at least 1.50 to 1.00, or (B) at the end of such 30-day period, such Borrower shall prepay its outstanding Advances by an amount necessary so that the Security Maintenance Ratio is at least 1.50 to 1.00.  All such prepayments shall be applied to the applicable Tranche of the Advances in accordance with Section 2.07(c)(vi).

(iii)          Collateral Disposition.  Immediately upon receipt of Collateral Disposition Proceeds, the Borrowers shall prepay the Advances in an amount equal to 100% of such

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Collateral Disposition Proceeds.  All such prepayments shall be applied to the Advances in accordance with Section 2.07(c)(vi).

(iv)          Casualty Event.

(A)          Upon the occurrence of a Casualty Event, if (1) no Event of Default has occurred and is continuing, (2) the applicable Loan Party reasonably believes that all necessary repairs to any Rig affected by a Casualty Event can be commenced within 90 days following such Casualty Event and completed within 180 days thereafter, and (3) during such 180-day period following commencement of such repairs, the applicable Loan Party works diligently to complete all such repairs, then the applicable Loan Party shall hold such Casualty Proceeds in a bank account subject to an Account Control Agreement and shall apply such Casualty Proceeds in payment for all necessary repairs, and following completion of such repairs within 180 days after commencement of such repairs and if no Event of Default has occurred and is continuing, the applicable Loan Party may retain the remainder of such Casualty Proceeds (together with accrued interest thereon), if any, and shall give notice to the Lenders thereof.  If all necessary repairs to any Rig affected by a Casualty Event shall not have been made within 180 days following commencement of such repairs, then the applicable Borrower shall prepay the Advances in an amount equal to 100% of the remaining Casualty Proceeds, and such prepayment shall be applied to the Advances in accordance with Section 2.07(c)(vi), and the Collateral Agent shall give notice to the Lenders thereof.

(B)           Upon the occurrence of a Casualty Event, if an Event of Default has occurred and is continuing, any Casualty Proceeds shall be delivered to the Collateral Agent which shall apply such Casualty Proceeds to the Advances in accordance with Section 2.07(c)(vi).

(C)           Notwithstanding anything to the contrary in the other Loan Documents, all insurance payments in respect of any liability of the Loan Parties to third Persons or damage to Property of third Persons by any Loan Party shall be paid by the underwriter of such Insurance Policy directly to the Person to whom such liability is owed or directly to the applicable Loan Party to reimburse it for any loss, damage or expense incurred by it in connection with the event or condition giving rise to such liability.

(v)           Indemnifications.  All Indemnification Proceeds payable to or received by the Loan Parties shall on the date of receipt by such Loan Party be applied to prepay the Advances in an amount equal to 100% of such Indemnification Proceeds.  All such prepayments shall be applied to the Advances in accordance with Section 2.07(c)(vi).

(vi)          Application of Prepayments.  Each prepayment pursuant to this Section 2.07(c) shall be accompanied by accrued interest on the amount prepaid to the date of such prepayment and amounts, if any, required to be paid pursuant to Section 2.08 as a result of such prepayment being made on such date.  Each prepayment required

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pursuant to this Section 2.07(c) shall be applied (a) to the prepayment of the applicable Tranche of Top-Up Advances in the inverse order of maturity of the remaining scheduled principal installments of such Tranche, (b) to the prepayment of the applicable Tranche of Term Advances in the inverse order of maturity of the remaining scheduled principal installments of such Tranche, (c) to the prepayment of the applicable Tranche of Revolving Advances, and, with respect to mandatory prepayments from Collateral Disposition Proceeds only, make deposits into the LC Cash Collateral Account to provide cash collateral for the Letter of Credit Exposure, together with a corresponding reduction of the applicable Tranche of the Revolving Commitment and (d) any remainder shall be applied ratably to each of the other Tranches of Advances, in the order set forth above.  In addition, the Borrower shall pay to the applicable Swap Counterparties the Swap Termination Value with respect to any Swap Contracts that terminate in whole or in part as a result of such mandatory prepayments set forth above.

(d)           Prepayment Premiums.  Each of the following events shall be subject to and accompanied by a premium determined in accordance with the table below based on the period during which such prepayment shall occur:

(i)            all optional prepayments of Term Advances or Top-Up Advances under Section 2.07(b),

(ii)           all mandatory prepayments under Section 2.07(c)(iii); and

(iii)          any termination of any Tranche of the Term Commitments or the Top-Up Commitments before such Commitments have been fully drawn,

Period:	Prepayment Premium  Percentage
From the Effective Date through the Rig 4 Delivery Date	1.00%
Rig 4 Delivery Date through the third anniversary thereof	0.50%
Third anniversary of the Rig 4 Delivery Date and thereafter	No prepayment premium

Such prepayment premium shall be equal to the product of the prepayment premium percentage specified above and (A) with respect to any optional prepayments of all or a portion of any Tranche of outstanding Term Advances or Top-Up Advances under Section 2.07(b), the principal amount of the Advances prepaid, (B) with respect to any mandatory prepayment under Section 2.07(c)(iii), the aggregate of such Tranche’s undrawn Commitments, and (C) with respect to any termination of any Tranche of the Term Commitments or the Top-Up Commitments before such Commitments have been fully drawn, the aggregate of such Tranche’s undrawn Term Commitments or undrawn Top-Up Commitments, as the case may be.

(e)           Illegality.  If any Lender shall notify the Facility Agent and the Borrowers that any Change in Law makes it unlawful for such Lender or its Applicable Lending Office to perform its obligations under this Agreement or to make or maintain Eurodollar Advances then

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outstanding hereunder, the Borrowers shall, no later than 10:00 a.m. (New York time) (i) (A) if not prohibited by any Legal Requirement to maintain such Eurodollar Advances for the duration of the Interest Period, on the last day of the Interest Period for each outstanding Eurodollar Advance or (B) if prohibited by any Legal Requirement to maintain such Eurodollar Advances for the duration of the Interest Period, on the second Business Day following its receipt of such notice, prepay all Eurodollar Advances of all of the Lenders then outstanding, together with accrued interest on the principal amount prepaid to the date of such prepayment and amounts, if any, required to be paid pursuant to Section 2.08 as a result of such prepayment being made on such date, (ii) each Lender shall simultaneously make a Base Rate Advance or, if not otherwise prohibited, make an Eurodollar Advance in an amount equal to the aggregate principal amount of the affected Eurodollar Advances, and (iii) the right of the Borrowers to select Eurodollar Advances shall be suspended until such Lender shall notify Facility Agent that the circumstances causing such suspension no longer exist.  Each Lender agrees to use commercially reasonable efforts (consistent with its internal policies and subject to legal and regulatory restrictions) to designate a different Applicable Lending Office if the making of such designation would avoid the effect of this paragraph and would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender.

(f)            Ratable Payments; Effect of Notice.  Each payment of any Advance pursuant to this Section 2.07 or any other provision of this Agreement shall be made in a manner such that all Advances comprising part of the same Borrowing are paid in whole or ratably in part.  All notices given pursuant to this Section 2.07 shall be irrevocable and binding upon the applicable Borrower.

Section 2.08           Funding Losses.  If (a) any payment of principal of any Eurodollar Advance is made other than on the last day of the Interest Period for such Advance as a result of any payment pursuant to Section 2.07 or the acceleration of the maturity of the Advances pursuant to Article VII or (b) if any Borrower fails to make a principal or interest payment with respect to any Eurodollar Advance on the date such payment is due and payable, such Borrower shall, within three Business Days of any written demand sent by any Lender to such Borrower through the Facility Agent, pay to Facility Agent for the account of such Lender any amounts (without duplication of any other amounts payable in respect of breakage costs) required to compensate such Lender for any additional losses, out-of-pocket costs or expenses which it may reasonably incur as a result of such payment or nonpayment, including, without limitation, any loss, cost or expense actually incurred by reason of the liquidation or reemployment of deposits or other funds acquired by any Lender to fund or maintain such Advance.  A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the applicable Borrower and shall be conclusive absent manifest error.

Section 2.09           Increased Costs.

(a)           Increased Costs Generally.  If any Change in Law shall:

(i)            impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any

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reserve requirement reflected in the Eurodollar Rate Reserve Percentage) or any Issuing Bank;

(ii)           subject any Agent, any Joint Bookrunner, any Mandated Lead Arranger, any Lender or any Issuing Bank to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Eurodollar Advance made by it, or change the basis of taxation of payments to such Person in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section 2.11 and the imposition of, or any change in the rate of, any Excluded Tax payable by such Agent, Joint Bookrunner, Mandated Lead Arranger, Lender or Issuing Bank); or

(iii)          impose on any Lender or Issuing Bank or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Advances made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Advance (or of maintaining its obligation to make any such Advance), or to increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or Issuing Bank hereunder (whether of principal, interest or any other amount) then, upon written request of such Lender or Issuing Bank, the applicable Borrower will pay to such Lender or Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered.

(b)           Capital Requirements.  If any Lender or Issuing Bank determines that any Change in Law affecting such Lender or Issuing Bank or any lending office of such Lender or such Lender’s or Issuing Bank’s holding company, if any, regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or Issuing Bank’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Advances made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or Issuing Bank’s policies and the policies of such Lender’s or Issuing Bank’s holding company with respect to capital adequacy), then from time to time the applicable Borrower will pay to such Lender or Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company for any such reduction suffered.

(c)           Certificates for Reimbursement.  A certificate of a Lender or a Issuing Bank setting forth the amount or amounts necessary to compensate such Lender or Issuing Bank or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section and delivered to the applicable Borrower shall be conclusive absent manifest error. Such Borrower shall pay such Lender or Issuing Bank, as the case may be, the amount shown as due on any such certificate within 10 days after receipt thereof.

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(d)           Delay in Requests.  Failure or delay on the part of any Lender or Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or Issuing Bank’s right to demand such compensation, provided that no Borrower shall be required to compensate a Lender or Issuing Bank pursuant to this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Lender or Issuing Bank, as the case may be, notifies the applicable Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or Issuing Bank’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

Section 2.10           Payments and Computations.

(a)           Payment Procedures.  Each Borrower shall make each payment under this Agreement not later than 12:00 p.m. (New York time) on the day when due to the Facility Agent at the Facility Agent’s Applicable Lending Office in immediately available funds.  Each Advance shall be repaid and each payment of interest thereon shall be paid in Dollars.  All payments shall be made without setoff, deduction, or counterclaim. The Facility Agent will promptly thereafter, and in any event prior to the close of business on the day any timely payment is made, cause to be distributed like funds relating to the payment of principal, interest or fees ratably (other than amounts payable solely to the Facility Agent, or a specific Lender pursuant to Section 2.03(b), 2.03(c), 2.08, 2.09 or 2.11, but after taking into account payments effected pursuant to Section 10.04) to the Lenders for the account of their respective Applicable Lending Offices, and like funds relating to the payment of any other amount payable to any Lender to such Lender for the account of its Applicable Lending Offices, in each case to be applied in accordance with the terms of this Agreement.

(b)           Computations.  All computations of interest and of fees shall be made by the Facility Agent, on the basis of a year of 360 days, in each case for the actual number of days (including the first day, but excluding the last day) occurring in the period for which such interest or fees are payable.  Each determination by the Facility Agent of an interest rate shall be conclusive and binding for all purposes, absent manifest error.

(c)           Non-Business Day Payments.  Whenever any payment shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or fees, as the case may be.

(d)           Agent Reliance.  Unless the Facility Agent shall have received written notice from any Borrower prior to the date on which any payment is due to the Lenders that such Borrower will not make such payment in full, the Facility Agent may assume that such Borrower has made such payment in full to the Facility Agent on such date and the Facility Agent may, in reliance upon such assumption, cause to be distributed to each Lender on such date an amount equal to the amount then due to such Lender.  If and to the extent such Borrower shall not have so made such payment in full to Facility Agent, each Lender shall repay to the Facility Agent forthwith on demand such amount distributed to such Lender, together with interest thereon, for each day from the date such amount is distributed to such Lender until the date such Lender

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repays such amount to the Facility Agent, at the greater of the Federal Funds Effective Rate for such day and a rate determined by the Facility Agent in accordance with banking industry rules on interbank compensation.

Section 2.11           Taxes.

(a)           Payments Free of Taxes.  Any and all payments by or on account of any obligation of any Loan Party hereunder or under any other Loan Document shall be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes, provided that if any Loan Party shall be required by any Legal Requirement to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Facility Agent, Lender or Issuing Bank, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, (ii) such Loan Party shall make such deductions and (iii) such Loan Party shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with Legal Requirements.

(b)           Payment of Other Taxes by the Borrowers.  Without limiting the provisions of paragraph (a) above, the Borrowers shall jointly and severally timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c)           Indemnification by the Borrowers.  The Borrowers shall jointly and severally indemnify the Facility Agent, each Lender and each Issuing Bank, within 10 days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) paid by the Facility Agent, such Lender or such Issuing Bank, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the applicable Borrower by a Lender or an Issuing Bank (with a copy to the Facility Agent), or by the Facility Agent on its own behalf or on behalf of a Lender or an Issuing Bank, shall be conclusive absent manifest error.

(d)           Evidence of Payments.  As soon as practicable after any payment of Indemnified Taxes or Other Taxes by any Borrower to a Governmental Authority, such Borrower shall deliver to the Facility Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Facility Agent.

(e)           Status of Lenders.  Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which any Borrower is resident for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments hereunder or under any other Loan Document shall deliver to such Borrower (with a copy to the Facility Agent), at the time or times prescribed by applicable law or reasonably requested by a Borrower or the Facility Agent, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced

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rate of withholding. In addition, any Lender, if requested by a Borrower or the Facility Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by such Borrower or the Facility Agent as will enable such Borrower or the Facility Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements.

                Without limiting the generality of the foregoing, in the event that any Borrower is resident for tax purposes in the United States of America, any Foreign Lender shall deliver to such Borrower and the Facility Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the written request of such Borrower or the Facility Agent, but only if such Foreign Lender is legally entitled to do so), whichever of the following is applicable:

(i)            duly completed copies of Internal Revenue Service Form W-8BEN claiming eligibility for benefits of an income tax treaty to which the United States of America is a party,

(ii)           duly completed copies of Internal Revenue Service Form W-8ECI,

(iii)          in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section 881(c) of the Code, (x) a certificate to the effect that such Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of any Borrower within the meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code and (y) duly completed copies of Internal Revenue Service Form W-8BEN, or

(iv)          any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in United States Federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable law to permit the Borrowers to determine the withholding or deduction required to be made.

(f)            Treatment of Certain Refunds.  If the Facility Agent, a Lender or an Issuing Bank determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by a Borrower or with respect to which a Borrower has paid additional amounts pursuant to this Section, it shall pay to such Borrower an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by such Borrower under this Section with respect to the Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of the Facility Agent, such Lender or such Issuing Bank, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund), provided that such Borrower, upon the written request of the Facility Agent, such Lender or such Issuing Bank, agrees to repay the amount paid over to such Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Facility Agent, such Lender or such Issuing Bank in the event the Facility Agent, such Lender or such Issuing Bank is required to repay such refund to such Governmental Authority. This paragraph shall not be construed to require the Facility

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Agent, any Lender or any Issuing Bank to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the Borrowers or any other Person.

Section 2.12           Sharing of Payments, Etc.  If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Advances or other obligations hereunder resulting in such Lender’s receiving payment of a proportion of the aggregate amount of its Advances and accrued interest thereon or other such obligations greater than its Pro Rata Share, then the Lender receiving such greater proportion shall (a) notify the Facility Agent of such fact, and (b) purchase (for cash at face value) participations in the Advances and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Advances and other amounts owing them, provided that: (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and (ii) the provisions of this paragraph shall not be construed to apply to (x) any payment made by any Loan Party pursuant to and in accordance with the express terms of this Agreement or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Advances or participations in Letters of Credit to any assignee or participant, other than to a Loan Party or any Subsidiary thereof (as to which the provisions of this paragraph shall apply). Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against each Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of each Loan Party in the amount of such participation.

Section 2.13           Applicable Lending Offices.  Each Lender may book its Advances at any Applicable Lending Office selected by such Lender and may change its Applicable Lending Office from time to time.  All terms of this Agreement shall apply to any such Applicable Lending Office and the Advances shall be deemed held by each Lender for the benefit of such Applicable Lending Office.  Each Lender may, by written notice to the Facility Agent designate replacement or additional Applicable Lending Offices through which Advances will be made by it and for whose account repayments are to be made.

Section 2.14           Letters of Credit.

(a)           Issuance.  From time-to-time from the Effective Date until 30 days before the Final Maturity Date, at the written request of any Borrower, the Issuing Banks shall, on the terms and conditions hereinafter set forth, issue, increase, or extend the expiration date of Letters of Credit for the account of a Borrower or for the account of any Loan Party (in which case a Borrower and such Loan Party shall be co-applicants with respect to such Letter of Credit) on any Business Day.  No Letter of Credit will be issued, increased, or extended:

(i)            except as otherwise provided in (ii) below, if the equity portion of the applicable Rig’s Total Cost as specified in the attached Schedule 2.01 has not already been paid by the applicable Borrower to the Shipyard, unless the applicable Borrower has

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deposited into the LC Cash Collateral Account an amount equal to the Letter of Credit Exposure with respect to such Letter of Credit.

(ii)           if such issuance, increase, or extension would cause the Letter of Credit Exposure to exceed (A) if the equity portion of Rig 1’s Total Cost as specified in the attached Schedule 2.01 has already been paid by the applicable Borrower to the Shipyard, the lesser of (1) $10,000,000 and (2) the Aggregate Revolving Commitments, (B) if the equity portion of Rig 2’s Total Cost as specified in the attached Schedule 2.01 has already been paid by the applicable Borrower to the Shipyard, the lesser of (1) $20,000,000 and (2) the Aggregate Revolving Commitments, (C) if the equity portion of Rig 3’s Total Cost as specified in the attached Schedule 2.01 has already been paid by the applicable Borrower to the Shipyard, on or before the Rig 4 Delivery Date, the lesser of (1) $30,000,000 and (2) the Aggregate Revolving Commitments, and (D) if the equity portion of Rig 4’s Total Cost as specified in the attached Schedule 2.01 has already been paid by the applicable Borrower to the Shipyard, the Aggregate Revolving Commitments, in each case minus the sum of the aggregate outstanding principal amount of all Revolving Advances;

(iii)          unless such Letter of Credit has an expiration date not later than the earlier of (A) two years after the date of issuance thereof or such longer period as agreed to by the applicable Issuing Bank and (B) five Business Days prior to the Final Maturity Date;

(iv)          unless such Letter of Credit is in form and substance acceptable to the applicable Issuing Bank in its sole discretion;

(v)           until the applicable Rig’s Delivery Date, with respect to any Letter of Credit which relates to a specific Rig, unless the beneficiary of such Letter of Credit is reasonably acceptable to the Joint Bookrunners and the Majority Lenders;

(vi)          unless the applicable Borrower has delivered to the applicable Issuing Bank a completed and executed Letter of Credit Application;

(vii)         unless such Letter of Credit is governed by any of (A) the Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500, (B) the Uniform Customs and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce Publication No. 600 or (C) the International Standby Practices, International Chamber of Commerce Commission Publication No. 590, or any successor to such publications.  If the terms of any letter of credit application referred to in the foregoing clause (iv) conflicts with the terms of this Agreement, the terms of this Agreement shall control; and

(viii)        prior to the Rig 1 Delivery Date, unless such Letter of Credit is issued as  a bid bond or performance bond;

Each Letter of Credit shall be issued or amended, as the case may be, upon the written request of the applicable Borrower delivered to the Issuing Bank (with a copy to the Facility Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of such Borrower.  Such Letter of Credit Application must be received by the Issuing

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Bank and the Facility Agent not later than 5:00 p.m. (Paris, France time) on the fifth Business Day (or such later date and time as the Facility Agent and the Issuing Bank may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be.  Additionally, the Borrower shall furnish to the Issuing Bank and the Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, as the Issuing Bank or the Facility Agent may require.

(b)           Participations.  Upon the date of the issuance or increase of a Letter of Credit occurring on or after the Effective Date, the applicable Issuing Bank shall be deemed to have sold to each other Lender and each other Lender shall have been deemed to have purchased from the applicable Issuing Bank a participation in the related Letter of Credit Obligations equal to such Lender’s Pro Rata Share at such date.  In consideration and in furtherance of the foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Facility Agent, for the account of the applicable Issuing Bank, such Lender’s Pro Rata Share of each payment or disbursement made by an Issuing Bank pursuant to a Letter of Credit and not reimbursed by the applicable Loan Party (or, if applicable, another party pursuant to its obligations under any other Loan Document) forthwith on the date due as provided in Section 2.14(c).  Each Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or an Event of Default, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.  The applicable Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit.  Such Issuing Bank shall as promptly as possible give telephonic notification, confirmed by fax, to the Facility Agent and the applicable Borrower of such demand for payment and whether such Issuing Bank has made or will make disbursement thereunder; provided that any failure to give or delay in giving such notice shall not relieve the applicable Borrower of its obligation to reimburse such Issuing Bank and the Lenders with respect to any such payment or disbursement.  The Facility Agent shall promptly give each Lender notice thereof.

(c)           Reimbursement.  Each Borrower hereby agrees to pay on demand to the applicable Issuing Bank in respect of each Letter of Credit issued for its account an amount equal to any amount paid by such Issuing Bank under or in respect of such Letter of Credit.  In the event any Issuing Bank makes a payment pursuant to a request for draw presented under a Letter of Credit and such payment is not promptly reimbursed by the applicable Borrower on the same Business Day, such Issuing Bank shall give notice of such failure to pay to the Facility Agent and the Lenders, and each Lender shall promptly reimburse the applicable Issuing Bank for such Lender’s Pro Rata Share of such payment, and such reimbursement shall be deemed for all purposes of this Agreement to constitute a Borrowing comprised of Eurodollar Rate Advances with an Interest Period of one month’s duration to the applicable Borrower from such Lender.  If such reimbursement is not made by any Lender to the applicable Issuing Bank on the same day on which such Issuing Bank shall have made payment on any such draw, such Lender shall pay interest thereon to such Issuing Bank at a rate per annum equal to the greater of the Federal Funds Effective Rate and a rate determined by the Facility Agent in accordance with banking industry rules on interbank compensation.  Each Borrower hereby unconditionally and irrevocably authorizes, empowers, and directs the Facility Agent and the Lenders to record and

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otherwise treat such payment under a Letter of Credit not immediately reimbursed by such Borrower as a Borrowing comprised of Eurodollar Rate Advances.

(d)           Obligations Unconditional.  The obligations of each Borrower under this Agreement in respect of each Letter of Credit shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, notwithstanding the following circumstances:

(i)            any lack of validity or enforceability of any Letter of Credit Documents, any Loan Document, or any term or provision therein;

(ii)           any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit Document or any Loan Document;

(iii)          the existence of any claim, set-off, defense or other right which any Borrower, any other party guaranteeing, or otherwise obligated with, such Borrower, any subsidiary or other Affiliate thereof or any other Person may have at any time against any beneficiary or transferee of such Letter of Credit (or any Persons for whom any such beneficiary or any such transferee may be acting), any Issuing Bank, any Lender or any other Person, whether in connection with this Agreement, any other Loan Document, the transactions contemplated in this Agreement or in any Letter of Credit Documents or any unrelated transaction;

(iv)          any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;

(v)           payment by an Issuing Bank under such Letter of Credit against presentation of a draft or certificate which does not strictly comply with the terms of such Letter of Credit; or

(vi)          any other act or omission to act or delay of any kind of the Issuing Banks, the Facility Agent, the Lenders or any other Person or any other event, circumstance or happening whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of any Borrower’s obligations hereunder.

Without limiting the generality of the foregoing, it is expressly understood and agreed that the absolute and unconditional obligation of each Borrower hereunder to reimburse each payment or disbursement made by an Issuing Bank pursuant to a Letter of Credit will not be excused by the gross negligence or willful misconduct of the applicable Issuing Bank.

(e)           Prepayments of Letters of Credit.  In the event that any Letters of Credit shall be outstanding or shall be drawn and not reimbursed after the Final Maturity Date, the Borrowers  shall jointly and severally pay to the Facility Agent an amount equal to the Letter of Credit Exposure allocable to such Letters of Credit to be held in the LC Cash Collateral Account and applied in accordance with paragraph (g) below.

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(f)            Liability of Issuing Bank.  Each Borrower assumes all risks of the acts or omissions of any beneficiary or transferee of any Letter of Credit with respect to its use of such Letter of Credit.  None of the Issuing Banks nor any of their respective officers or directors shall be liable or responsible for:

(i)            the use which may be made of any Letter of Credit or any acts or omissions of any beneficiary or transferee in connection therewith;

(ii)           the validity, sufficiency or genuineness of documents, or of any endorsement thereon, even if such documents should prove to be in any or all respects invalid, insufficient, fraudulent or forged;

(iii)          payment by an Issuing Bank against presentation of documents which do not comply with the terms of a Letter of Credit, including failure of any documents to bear any reference or adequate reference to the relevant Letter of Credit; or

(iv)          any other circumstances whatsoever in making or failing to make payment under any Letter of Credit (including such Issuing Bank’s own negligence),

except that a Borrower shall have a claim against an Issuing Bank, and an Issuing Bank shall be liable to, and shall promptly pay to, a Borrower, to the extent of any direct, as opposed to consequential (claims in respect of which are hereby waived by the Borrowers to the extent permitted by applicable law), damages suffered by such Borrower which such Borrower proves were caused by such Issuing Bank’s willful misconduct or gross negligence in determining whether documents presented under a Letter of Credit strictly comply with the terms of such Letter of Credit.  It is understood that an Issuing Bank may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (i) such Issuing Bank’s exclusive reliance on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (ii) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of such Issuing Bank.

(g)           LC Cash Collateral Account.

(i)            If the Borrowers are required to deposit funds in the LC Cash Collateral Account pursuant to Sections 2.07(c), 2.14(a)(vii), 2.14(e), 7.02(b) or 7.03(b), then the Borrowers and the Facility Agent shall establish the LC Cash Collateral Account and the Borrowers shall execute any documents and agreements, including the Facility Agent’s standard form assignment of deposit accounts, that the Facility Agent requests in connection therewith to establish the LC Cash Collateral Account and grant the Facility

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Agent an Acceptable Security Interest in such account and the funds therein.  Each Borrower hereby pledges to the Facility Agent and grants the Facility Agent a security interest in the LC Cash Collateral Account, whenever established, all funds held in the LC Cash Collateral Account from time to time, and all proceeds thereof as security for the payment of the Obligations.

(ii)           Funds held in the LC Cash Collateral Account shall be held as cash collateral for obligations with respect to Letters of Credit and promptly applied by the Facility Agent at the written request of any Issuing Bank to any reimbursement or other obligations under Letters of Credit that exist or occur.  To the extent that any surplus funds are held in the LC Cash Collateral Account above the Letter of Credit Exposure during the existence of an Event of Default the Facility Agent may (A) hold such surplus funds in the LC Cash Collateral Account as cash collateral for the Obligations or (B) apply such surplus funds to any Obligations in any manner directed by the Majority Lenders.  Except with respect to funds deposited in the LC Cash Collateral Account pursuant to Section 2.14(a)(vii), if no Default or Event of Default exists, the Facility Agent shall release to the Borrowers at the Borrowers’ written request any funds held in the LC Cash Collateral Account above the amounts required by Section 2.14(e) or otherwise.  With respect to funds deposited in the LC Cash Collateral Account pursuant to Section 2.14(a)(vii), if no Default or Event of Default exists, the Facility Agent shall release to the Borrowers at the Borrowers’ written request any funds held in the LC Cash Collateral Account above the amounts required by Section 2.14(a)(vii) if the Facility Agent has received satisfactory evidence that the equity portion of the applicable Rig’s Total Cost as specified in the attached Schedule 2.01 has already been paid by the applicable Borrower to the Shipyard.

(iii)          Funds held in the LC Cash Collateral Account shall be invested in Cash Equivalents maintained with, and under the sole dominion and control of, the Facility Agent or in another investment if mutually agreed upon by the Borrowers and the Facility Agent, but the Facility Agent shall have no other obligation to make any other investment of the funds therein.  The Facility Agent shall exercise reasonable care in the custody and preservation of any funds held in the LC Cash Collateral Account and shall be deemed to have exercised such care if such funds are accorded treatment substantially equivalent to that which the Facility Agent accords its own property, it being understood that the Facility Agent shall not have any responsibility for taking any necessary steps to preserve rights against any parties with respect to any such funds.

Section 2.15           Mitigation Obligations; Designation of a Different Lending Office.  If any Lender requests compensation under Section 2.09, or requires any Borrower to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.11, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.09 or 2.11, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The

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Borrowers hereby jointly and severally agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

Section 2.16           Joint and Several Liability of the Borrowers.

(a)           Each of the Borrowers is accepting joint and several liability hereunder in consideration of the Advances and Letters of Credit to be provided by the Lenders and the Facility Agent under this Agreement, for the mutual benefit, directly and indirectly, of each of the Borrowers and in consideration of the undertakings of each of the Borrowers to accept joint and several liability for the obligations of each of them with respect to the Obligations.

(b)           Each of the Borrowers jointly and severally hereby irrevocably and unconditionally accepts, not merely as a surety but also as a co-debtor, joint and several liability with the other Borrower, with respect to the payment and performance of all of the obligations arising under this Agreement, it being the intention of the parties hereto that all the obligations with respect to the Obligations shall be the joint and several obligations of all the Borrowers without preferences or distinction among them.

(c)           If and to the extent that any of the Borrowers shall fail to make any payment with respect to any of the obligations hereunder as and when due or to perform any of such obligations in accordance with the terms thereof, then in each such event the other Borrower will make such payment with respect to, or perform, such obligation.

(d)           The obligations of each Borrower under the provisions of this Section 2.16 constitute full recourse obligations of such Borrower enforceable against it to the full extent of its properties and assets, irrespective of the validity, regularity or enforceability of this Agreement or any other circumstance whatsoever.

(e)           The provisions of this Section 2.16 are made for the benefit of the Lenders and the Facility Agent and their successors and assigns, and may be enforced by them in accordance with the terms of this Agreement from time to time against either of the Borrowers as often as occasion therefor may arise and without requirement on the part of the Lenders or the Facility Agent first to marshall any of their claims or to exercise any of their rights against the other Borrower or to exhaust any remedies available to them against the other Borrower or to resort to any other source or means of obtaining payment of any of the obligations hereunder or to elect any other remedy.  The provisions of this Section 2.16 shall remain in effect until all the obligations hereunder shall have been paid in full or otherwise fully satisfied.  If at any time, any payment, or any part thereof, made in respect of any of the obligations, is rescinded or must otherwise be restored or returned by the Lenders or the Facility Agent upon the insolvency, bankruptcy or reorganization of the Borrowers, or otherwise, the provisions of this Section 2.16 will forthwith be reinstated in effect, as though such payment had not been made.

Section 2.17           Mitigation Obligations; Replacement of Lenders.

(a)           Designation of a Different Lending Office. If any Lender requests compensation under Section 2.09, or any Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.11, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking

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its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.09 or 2.11, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrowers hereby jointly and severally agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b)           Replacement of Lenders.  If any Lender requests compensation under Section 2.09, or if any Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.11, or if any Lender defaults in its obligation to fund Loans hereunder, then the Borrowers may, at their sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.06), all of its interests, rights and obligations under this Agreement and the related Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that: (i) the Borrowers shall have paid to the Administrative Agent the assignment fee specified in Section 10.06; (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 2.08) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrowers (in the case of all other amounts); (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.09 or payments required to be made pursuant to Section 2.11, such assignment will result in a reduction in such compensation or payments thereafter; and (iv) such assignment does not conflict with Legal Requirements. A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

ARTICLE III
CONDITIONS OF LENDING

Section 3.01           Initial Conditions Precedent.  The obligation of each Lender to make its initial Advances as part of the initial Borrowing or any Issuing Bank to issue the initial Letters of Credit is subject to the conditions precedent that:

(a)           Documentation.  On or before the day on which the initial Borrowing is made or the initial Letter of Credit is issued, the Facility Agent and the Lenders shall have received the following, each dated as of the Closing Date unless otherwise indicated below, duly executed by all the parties thereto, each in form and substance satisfactory to the Facility Agent and the Lenders:

(i)            this Agreement and all attached Exhibits and Schedules;

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(ii)           any Note requested by a Lender pursuant to Section 2.02(g) payable to the order of such requesting Lender in the amount of each Tranche of its Term Commitment, Top-Up Commitment or Revolving Commitment;

(iii)          the Security Agreement, together with UCC-1 financing statements and any other documents, agreements or instruments necessary to create an Acceptable Security Interest in the Collateral described therein;

(iv)          the Pledge Agreement pledging to the Collateral Agent for the benefit of the Secured Parties all of the Equity Interests of the Subsidiaries of the Parent and the Subsidiaries of the other Loan Parties, together with stock certificates, stock powers executed in blank, UCC-1 financing statements and any other documents, agreements or instruments necessary to create an Acceptable Security Interest in such Equity Interest;

(v)           the Collateral Assignment of Rig Construction Contract and any other documents, agreements or instruments necessary to create an Acceptable Security Interest therein;

(vi)          a certificate dated as of the Effective Date from a Responsible Officer of the Parent stating that (A) all representations and warranties of the Loan Parties set forth in this Agreement and in the other Loan Documents to which it is a party are true and correct in all material respects; (B) no Default has occurred and is continuing; and (C) the conditions in this Section 3.01 have been met;

(vii)         copies of the certificate or articles of incorporation or other equivalent organizational documents, including all amendments thereto, of each Loan Party, certified as of a recent date by the Secretary of State or other functional equivalent of the jurisdiction of its organization, if available;

(viii)        a certificate of the Secretary or Assistant Secretary of each Loan Party dated as of the Closing Date and certifying (A) that attached thereto is a true and complete copy of the by-laws or other functional equivalent of such Loan Party as in effect on the Closing Date, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors or other functional equivalent of such Loan Party authorizing the execution, delivery and performance of the Loan Documents to which such Loan Party is a party and, in the case of each Borrower, the borrowings hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the certificate or articles of incorporation or other organizational documents of such Loan Party have not been amended since the date of the last amendment thereto shown on the certificate furnished pursuant to clause (vii) above, and (D) as to the incumbency and specimen signature of each officer executing any Loan Document, Notices of Borrowing or any other document delivered in connection herewith on behalf of such Loan Party;

(ix)           a certificate of another officer dated as of  the Closing Date as to the incumbency and specimen signature of the Secretary or Assistant Secretary executing the certificate pursuant to (viii) above;

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(x)            certificates from the appropriate Governmental Authority certifying as of a recent date as to the good standing, existence and authority of each of the Loan Parties in all jurisdictions where required by the Facility Agent;

(xi)           a favorable opinion dated as of the Closing Date of Porter & Hedges LLP, New York counsel to the Loan Parties;

(xii)          a favorable opinion dated as of the Closing Date of Maples and Calder, Cayman Islands counsel to the Loan Parties;

(xiii)         a favorable opinion dated as of the Closing Date of Herbert Smith, English counsel to the Facility Agent;

(xiv)        a certificate from the chief financial officer of the Parent dated as of the Closing Date addressed to the Facility Agent and each of the Lenders regarding the matters set forth in Section 4.19;

(xv)         a certificate from the chief financial officer of the Parent addressed to the Facility Agent and each of the Lenders which shall reaffirm that as of the Closing Date the Projections prepared by the Parent and previously provided to the Joint Bookrunners and the Lenders are true and correct in all material respects based upon the assumptions stated therein and the best information reasonably available to such officer at the time such Projections were made and shall describe any changes therein and state that such changes shall not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect;

(xvi)        copies of each of the Transaction Documents certified as of the Closing Date by a Responsible Officer (A) as being true and correct copies of such documents as of the Closing Date, (B) as being in full force and effect and (C) that no material term or condition thereof shall have been amended, modified or waived after the execution thereof without the prior written consent of the Majority Lenders;

(xvii)       copies of each of the Drillship Documents certified as of the Closing Date by a Responsible Officer (A) as being true and correct copies of such documents as of the Closing Date, and (B) as being in full force and effect;

(xviii)      a pro forma certificate as to the prospective coverage under the Insurance Policies required by Section 5.04 and the applicable provisions of the Security Documents;

(xix)         acknowledgment from CT Corporation System as of the Closing Date with respect to its irrevocable appointment by each Loan Party pursuant to Section 10.14(b);

(xx)          no less than three Business Days prior to the Closing Date, all documentation and other information which any Joint Bookrunner, any Agent or any Lender reasonably requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act; and

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(xxi)         such other documents, governmental certificates and agreements as any Agent or any Lender  may reasonably request.

(b)           Payment of Fees.  On the Effective Date, the Borrowers shall have paid the fees required to be paid to the Agents, the Joint Bookrunners, and the Lenders on the Effective Date, including, without limitation, the fees set forth in the Fee Letters and all other costs and expenses which have been invoiced and are payable pursuant to Section 10.04.

(c)           Due Diligence.  The Joint Bookrunners shall have completed satisfactory due diligence review of the assets, liabilities, business, operations and condition (financial or otherwise) of the Parent and its Subsidiaries, and all legal, financial, accounting, governmental, tax and regulatory matters, and fiduciary aspects of the proposed financing.

(d)           Consummation of the Vantage Acquisition.  The Joint Bookrunners shall have had the opportunity to review and shall be satisfied with the terms of the Transaction Documents, including all disclosure schedules and exhibits thereto, and the Joint Bookrunners shall have received evidence satisfactory to the Joint Bookrunners confirming that (i) all of the transactions contemplated by the Transaction Documents and the Proxy Statement shall have been consummated and no conditions under such documents remain unsatisfied and (ii) the Vantage Acquisition shall have occurred on or before the Effective Date.  All of the conditions to the effectiveness to each of the Rig Construction Contracts shall have been satisfied.

(e)           Security Documents.  The Collateral Agent shall have received all appropriate evidence required by the Collateral Agent in its sole discretion necessary to determine that arrangements have been made for the Collateral Agent for the benefit of Secured Parties to have an Acceptable Security Interest in the Collateral, including, without limitation, (i) the delivery to the Collateral Agent of such financing statements under the Uniform Commercial Code for filing in such jurisdictions as the Collateral Agent may require, and (ii) lien, tax and judgment searches conducted on the Loan Parties reflecting no Liens other than Permitted Prior Liens against any of the Collateral as to which perfection of a Lien is accomplished by the filing of a financing statement.

(f)            Financial Statements.  The Facility Agent and the Lenders shall have received true and correct copies of (i) the Audited Financial Statements, (ii) the Pro Forma Financial Statements and (iii) the Projections for the five year period commencing on the Effective Date and such other financial information as any Joint Bookrunners may reasonably request.

(g)           No Proceeding or Litigation; No Injunctive Relief.  No action, suit, investigation or other proceeding (including, without limitation, the enactment or promulgation of a statute or rule) by or before any arbitrator or any Governmental Authority shall be threatened or pending and no preliminary or permanent injunction or order by a state or federal court shall have been entered (i) in connection with this Agreement or any of the Transactions or (ii) which, in any case, in the reasonable judgment of the Facility Agent, could reasonably be expected to have a Material Adverse Effect.

(h)           Authorizations and Approvals.  All Governmental Authorities and Persons shall have approved or consented to the Transactions and the transactions contemplated hereby,

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including, without limitation, those required in connection with the continued operation of the Parent and its Subsidiaries, to the extent required, and such approvals shall be in full force and effect, and all applicable waiting periods shall have expired without any action being taken or threatened that would restrain, prevent or otherwise impose adverse conditions on this Agreement, the Transactions and the actions contemplated hereby and thereby.

(i)            No Default.  No Default shall have occurred and be continuing or would result from such Advance or from the application of the proceeds therefrom.

(j)            Representations and Warranties.  The representations and warranties contained in Article IV hereof and in each other Loan Document shall be true and correct before and after giving effect to the Advances and to the application of the proceeds from such Advances from the date of the Advances, as though made on and as of such date.

(k)           No Material Adverse Effect.  Since December 31, 2006, no event or events that, individually or in the aggregate, has had or is reasonably likely to have a Material Adverse Effect shall have occurred.

Section 3.02           Conditions Precedent to Term Borrowings.  The obligation of each Lender to make each Term Advance as part of each Term Borrowing for each particular Tranche is subject to the conditions precedent that:

(a)           the Facility Agent has received satisfactory evidence that the equity portion of the applicable Rig’s Total Cost as specified in the attached Schedule 2.01 has already been paid by the applicable Borrower to the Shipyard;

(b)           the Facility Agent shall have received evidence, satisfactory to the Facility Agent in its sole discretion, that the installment under the Rig Construction Contract being financed by such Term Borrowing is then due and payable in accordance with the terms thereof, including a commercial invoice from the Shipyard for such amount;

(c)           the Facility Agent shall have received the on-site report of the Technical Advisor addressed to the Facility Agent and the Lenders confirming (i) that construction of such Rig up to such date has been in accordance with the Specifications (as defined in the applicable Rig Construction Contract), and (ii) that the Technical Advisor has no reason to believe that such Rig will not be completed  and delivered in accordance with the terms of the Rig Construction Contract on or before the applicable Delivery Date;

(d)           unless the Joint Bookrunners in consultation with the Majority Lenders shall have otherwise consented in writing, prior to the making of any additional Term Advances that consist of Tranche 2 Advances, Tranche 3 Advances or Tranche 4 Advances after the Rig 1 Delivery Date, the applicable Borrower shall have entered into a drilling contract reasonably acceptable to the Joint Bookrunners with respect to Rig 1; and

(e)           unless the Joint Bookrunners in consultation with the Majority Lenders shall have otherwise consented in writing, prior to the making of any additional Term Advances that consist of Tranche 2 Advances, Tranche 3 Advances or Tranche 4 Advances after the Rig 1 Delivery

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Date, the applicable Borrower has complied with the requirements of Sections 5.14 and 5.15 with respect to Rig 1.

Section 3.03           Conditions Precedent to Top-Up Borrowings.  The obligation of each Lender to make each Top-Up Advance as part of each Top-Up Borrowing for each particular Tranche is subject to the conditions precedent that:

(a)           the applicable Rig with respect to the Tranche of Top-Up Advances is operating  and accepted for service under the terms of a Drilling Contract;

(b)           the applicable Borrower has delivered an executed Charter Assignment in accordance with the requirements of Section 5.15 with respect to such Drilling Contract;

(c)           such Drilling Contract will generate sufficient revenue as determined by the Facility Agent, and notified to the Lenders, for the applicable Borrower in order to amortize in full the related Top-Up Advance during the term of such Drilling Contract, in addition to any mandatory repayments of the Term Advances of the same Tranche during such term; and

(d)           the applicable Borrower has complied with the requirements of Sections 5.14 and 5.15.

Section 3.04           Conditions Precedent to Revolving Borrowings.  The obligation of each Lender to make each Revolving Advance as part of each Revolving Borrowing for each particular Tranche is subject to the conditions precedent that, with respect to each Tranche of Revolving Advances, the applicable Borrower shall have complied with the requirements of Sections 5.14 and 5.15.

Section 3.05           Conditions Precedent to Each Borrowing.  The obligation of each Lender to make an Advance on the occasion of each Borrowing (including the initial Borrowing) or Continue a Eurodollar Advance for an Interest Period of longer than one month’s duration, and the obligation of the Issuing Banks to issue, extend or increase Letters of Credit shall be subject to the further conditions precedent that on the Borrowing Date, the date of Continuation, or issuance, extension or increase date of such Letters of Credit, the following statements shall be true (and each of the giving of the applicable Notice of Borrowing or Notice of Continuation and the acceptance by a Borrower of the proceeds of such Advance or the written request for the issuance, extension or increase of a Letter of Credit shall constitute a representation and warranty by such Borrower that on the date of such Advance, the date of such Continuation, or the date of such issuance, extension or increase such statements are true):

(a)           the representations and warranties contained in Article IV and in each other Loan Document are correct on and as of the date of such Advance or Continuation, or the issuance, extension or increase of such Letter of Credit before and after giving effect to such Advance and to the application of the proceeds from such Advance or such Continuation, or to the issuance, extension or increase of such Letter of Credit, as applicable, as though made on, and as of such date;

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(b)           no Default has occurred and is continuing or would result from such Advance or from the application of the proceeds therefrom or from such issuance, extension or increase of such Letter of Credit; and

(c)           no Material Adverse Effect shall have occurred and be continuing.

Section 3.06           Determinations Under Sections 3.01, 3.02, 3.03, 3.04 and 3.05.  For purposes of determining compliance with the conditions specified in Sections 3.01, 3.02, 3.03, 3.04 and 3.05, each Lender shall be deemed to have consented to, approved or accepted or to be satisfied with each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to the Lenders unless an officer of the Facility Agent responsible for the transactions contemplated by the Loan Documents shall have received written notice from such Lender prior to the Borrowings hereunder specifying its objection thereto and such Lender shall not have made available to the Facility Agent such Lender’s ratable portion of such Borrowings.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

Each Loan Party jointly and severally represents and warrants to the Secured Parties as follows:

Section 4.01           Existence; Subsidiaries.  Each of the Loan Parties is duly formed, validly existing, and in good standing (to the extent the concept of good standing is applicable in such jurisdiction) under the laws of the jurisdiction of its formation and qualified to do business in each jurisdiction where its ownership or lease of Property or conduct of its business requires such qualification and where a failure to be so qualified could reasonably be expected to have a Material Adverse Effect.

Section 4.02           Power and Authority.  Each of the Loan Parties has the requisite power and authority to own its assets and carry on its business and execute and deliver the Loan Documents to which it is a party and to perform its obligations thereunder.  The execution, delivery, and performance by each Loan Party of this Agreement and the other Loan Documents to which it is a party and the consummation of the transactions contemplated hereby (a) have been duly authorized by all necessary organizational action, (b) do not and will not (i) contravene the terms of any such Person’s organizational documents, (ii) violate any Legal Requirement, or (iii) conflict with or result in any breach or contravention of, or the creation of any Lien under (A) the provisions of any indenture, instrument or agreement to which such Loan Party is a party or is subject, or by which it, or its Property, is bound or (B) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject.

Section 4.03           Authorization and Approvals.  No authorization, approval, consent, exemption, or other action by, or notice to or filing with, any Governmental Authority or any other Person is necessary or required on the part of any Loan Party in connection with the execution, delivery and performance by, or enforcement against, any Loan Party of this

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Agreement and the other Loan Documents to which it is a party or the consummation of the Transactions or the transactions contemplated hereby or thereby.

Section 4.04           Enforceable Obligations.  This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by each Loan Party that is a party thereto.  This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that is party thereto in accordance with its terms, except as such enforceability may be limited by any applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium, or similar law affecting creditors’ rights generally or general principles of equity.

Section 4.05           Financial Statements; No Material Adverse Effect.

(a)           The Parent has delivered to the Facility Agent and the Lenders copies of the Audited Financial Statements, and the Audited Financial Statements are accurate and complete in all material respects and present fairly in all material respects the consolidated financial condition of Parent and its consolidated Subsidiaries as of their respective dates and for their respective periods.  The most recent consolidated and consolidating financial statements of the Parent delivered to the Facility Agent and the Lenders pursuant to Section 5.06(a) and (b) are accurate and complete in all material respects and present fairly in all material respects the respective consolidated financial condition of Parent as of their respective dates and for their respective periods.  As of the date of such financial statements of the Parent delivered to the Facility Agent and the Lenders pursuant to Section 5.06(a) and (b), there were no material contingent obligations, liabilities for taxes, unusual forward or long-term commitments, or unrealized or anticipated losses of the Parent or any of its Subsidiaries, except as disclosed therein and adequate reserves for such items have been made in accordance with GAAP.

(b)           The Pro Forma Financial Statements have been prepared in good faith by the Parent, based on the assumptions used to prepare the pro forma financial information contained in the Confidential Information Memorandum (which assumptions are believed by the Parent on the date hereof and on the Closing Date to be reasonable), are based on the best information available to the Parent as of the date of delivery thereof, accurately reflect all adjustments required to be made to give effect to the Transactions and present fairly, in all material respects, on a pro forma basis the estimated consolidated financial position of the Parent and its consolidated Subsidiaries as of such date and for such period, assuming that the Transactions had actually occurred at such date or at the beginning of such period, as the case may be.

(c)           The Projections delivered by the Parent to the Facility Agent and the Lenders prior to the Closing Date have been prepared in good faith and are based on reasonable assumptions, and there are no statements or conclusions in such projections which are based upon or include information known to the Parent on the Closing Date to be misleading in any material respect or which fail to take into account material information known to the Parent on the Closing Date regarding the matters reported therein. On the Closing Date, the Parent believes that such Projections are reasonable and attainable, it being recognized by the Lenders, however, that projections as to future events are not to be viewed as facts and that the actual results during

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the period or periods covered by the Projections may differ from the projected results included in such Projections.

(d)           Since December 31, 2007, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

Section 4.06           True and Complete Disclosure.  Each of the Loan Parties has disclosed to the Facility Agent and the Lenders all agreements, instruments and corporate or other restrictions to which it or any of its Subsidiaries is subject, and all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.  None of (a) the Confidential Information Memorandum, (b) the Proxy Statement or (c) any other written information, report, financial statement, exhibit or schedule furnished by or on behalf of any Loan Party to the Facility Agent or any Lender (whether delivered before or after the Closing Date) in connection with the negotiation of any Loan Document or included therein or delivered pursuant thereto contained, contains or will contain any material misstatement of fact or omitted, omits or will omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were, are or will be made, not misleading; provided that, with respect to projected financial information, the Loan Parties represent only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.

Section 4.07           Litigation.  There are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of any Responsible Officer of any Loan Party, after due and diligent investigation, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against the Parent or any of its Subsidiaries or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement or any other Loan Document, or any of the Transactions, or (b) either individually or in the aggregate, if determined adversely, could reasonably be expected to have a Material Adverse Effect.  Additionally, there is no pending or, to the knowledge of any Responsible Officer of any Loan Party, threatened action or proceeding instituted against the Parent or any of its Subsidiaries which seeks to adjudicate the Parent or any of its Subsidiaries as bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver, trustee or other similar official for it or for any substantial part of its Property.

Section 4.08           Compliance with Laws.  Each of the Parent and its Subsidiaries have complied with, and each Rig is and will be operated in material compliance with, all Legal Requirements (including any Environmental Law) applicable to the conduct of their respective businesses or the ownership of their respective Property.  Neither the Parent nor any of its Subsidiaries is in default with respect to any judgment, writ, injunction, decree or order of any Governmental Authority.  The Parent and its Subsidiaries are in compliance in all material respects with the International Maritime Organization’s International Management Code for the Safe Operation of Ships and Pollution Prevention (“ISM Code”), to the extent applicable, and have established and implemented a safety management system and such other procedures as required by the ISM Code, to the extent applicable.

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Section 4.09           No Default.  Neither the Parent nor any of its Subsidiaries is in default, or will be in default with notice or lapse of time or both, in any manner under or has received any notice of default with respect to any provision of any indenture or other agreement or instrument evidencing Debt, any Transaction Document, any drilling contract or any other material agreement or instrument to which it is a party or by which it or any of its properties or assets are or may be bound.  No Default has occurred and is continuing or would result from the consummation of the Vantage Acquisition, the Transactions or the other transactions contemplated by this Agreement or any other Loan Document.

Section 4.10           Subsidiaries; Corporate Structure.  Schedule 4.10 sets forth as of the Closing Date a list of all Subsidiaries of the Parent and, as to each such Subsidiary, the jurisdiction of formation, the outstanding Equity Interests therein, and the owner thereof.  The Equity Interests indicated to be owned by the Person on Schedule 4.10 are fully paid and non-assessable and are owned by the persons indicated on such Schedule, free and clear of all Liens.

Section 4.11           Condition of Properties.  Each of the Parent and its Subsidiaries has good and indefeasible title in all its Property, necessary or used in the ordinary conduct of its business (including all Rigs), except for such minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to use such properties and assets for their intended purposes.  The property of the Parent and its Subsidiaries is subject to no Liens, other than Permitted Liens.

Section 4.12           Environmental Condition.

(a)           The Parent and its Subsidiaries (i) have obtained all material Environmental Permits necessary for the ownership and operation of their respective material Properties and the conduct of their respective businesses; (ii) are not in breach of any material terms and conditions of such Environmental Permits or any other material requirements of applicable Environmental Laws; (iii) have not received notice of any material violation or alleged violation of any Environmental Law or Environmental Permit which would affect the ability of the Parent or such Subsidiary to operate any Rig; and (iv) are not subject to any material actual or contingent Environmental Claim.

(b)           There are no facts, circumstances, conditions or occurrences on any Rig owned or operated by the Parent or any of its Subsidiaries that is reasonably likely (i) to form the basis of an Environmental Claim against the Loan Parties, any of their Subsidiaries or any Rig owned by the Parent or any of its Subsidiaries, or (ii) to cause such Rig to be subject to any restrictions on its ownership, occupancy, use or transferability under any Environmental Law.

(c)           Neither the Parent nor any of its Subsidiaries has at any time (i) generated, used, treated or stored Hazardous Materials on, or transported Hazardous Materials to or from, any Rig at any time owned or operated by the Parent or any of its Subsidiaries or (ii) released Hazardous Materials on or from any such Rig, in each case where such occurrence or event, either individually or in the aggregate, is reasonably likely to have a Material Adverse Effect.

Section 4.13           Insurance.  Each of the Parent and its Subsidiaries carries the insurance required to be carried under Section 5.04 of this Agreement.  The properties of the Parent and its

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Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of the Parent, in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Parent or the applicable Subsidiary operates.

Section 4.14           Taxes.  All federal, state, local and foreign tax returns, reports and statements required to be filed (after giving effect to any extension granted in the time for filing) by the Parent and its Subsidiaries have been filed with the appropriate Governmental Authorities in all jurisdictions in which such returns, reports and statements are required to be filed (except where any obligation to so file is being contested in good faith and by appropriate proceedings and after adequate reserves for such items have been made in accordance with GAAP), and all taxes and other impositions due and payable have been timely paid prior to the date on which any fine, penalty, interest, late charge or loss may be added thereto for non-payment thereof except where contested in good faith and by appropriate proceedings and after providing adequate reserves therefor.  None of the Parent or any of its Subsidiaries has given, or been requested to give, a waiver of the statute of limitations relating to the payment of any federal, state, local or foreign taxes or other impositions.  Proper and accurate amounts have been withheld by the Parent and its Subsidiaries from their employees for all periods to comply in all material respects with the tax, social security and unemployment withholding provisions of applicable federal, state, local and foreign law.  Timely payment of all material sales and use taxes required by applicable law have been made by the Parent and its Subsidiaries.

Section 4.15           ERISA Compliance.

(a)           Each of the Parent and its ERISA Affiliates is in compliance in all material respects with the applicable provisions of ERISA and the Code and the regulations and published interpretations thereunder.

(b)           Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal or state Laws.  Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect thereto and, to the best knowledge of the Parent, nothing has occurred which would prevent, or cause the loss of, such qualification.  The Parent and each ERISA Affiliate have made all required contributions to each Plan subject to Section 412 of the Code, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan.

(c)           (i) No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events, could reasonably be expected to result in material liability of the Parent or any of its ERISA Affiliates; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither the Parent nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither the Parent nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Sections 4201 or 4243 of ERISA with respect to a

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Multiemployer Plan; and (v) neither the Parent nor any ERISA Affiliate has engaged in a transaction that could be subject to Sections 4069 or 4212(c) of ERISA.

Section 4.16           Security Interests.

(a)           The Pledge Agreement is effective to create in favor of the Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid and enforceable security interest in the Pledged Collateral (as defined in such Pledge Agreement) and, when such Collateral (to the extent such Pledged Collateral constitutes a certificated security or an instrument under the applicable Uniform Commercial Code) is delivered to such Collateral Agent, such Pledge Agreement shall constitute a fully perfected first priority Lien on, and security interest in, all right, title and interest of the pledgors thereunder in such Pledged Collateral, in each case prior and superior in right to any other person.

(b)           The Security Agreement is effective to create in favor of the Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid and enforceable security interest in the Collateral (as defined in such Security Agreement) and, when financing statements in appropriate form are filed in the offices specified on Schedule 1 to the Security Agreement, such Security Agreement shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the grantors thereunder in such portion of the Collateral in which a security interest may be perfected by the filing of a financing statement under the applicable Uniform Commercial Code, in each case prior and superior in right to any other person, other than Permitted Prior Liens.

(c)           After the execution and delivery of each Rig Mortgage, each Rig Mortgage will be effective to create in favor of the Collateral Agent for the ratable benefit of the Secured Parties a legal, valid and enforceable security interest in all Collateral (as defined in such Rig Mortgage) and, when appropriate filings or registrations are made in accordance with the laws of the Rig’s flag, such Rig Mortgage shall constitute a first preferred perfected mortgage Lien on all right, title and interest of the applicable Loan Party thereunder in the applicable Rig, prior and superior in right to any other person, other than Permitted Prior Liens, and will constitute a “preferred mortgage” within the meaning of Section 31301(6) of Title 46 of the United States Code, entitled to the benefits accorded a preferred mortgage on a foreign vessel, in the case of Rigs not registered under the laws and flag of the United States, and in the case of Rigs registered under the laws and flag of the United States, constitutes a “preferred mortgage” within the meaning of Section 31301(6) of Title 46 of the United States Code, entitled to the benefits accorded a preferred mortgage on a registered vessel under the laws and flag of the United States.

Section 4.17           Labor Relations.  There (a) is no unfair labor practice complaint pending against the Parent or any of its Subsidiaries or, to the knowledge of any Responsible Officer of any Loan Party, threatened against any of them, before the National Labor Relations Board (or any successor United States federal agency that administers the National Labor Relations Act), and no grievance or arbitration proceeding arising out of or under any collective bargaining agreement is so pending against the Parent or any of its Subsidiaries or, to the knowledge of any Responsible Officer of any Loan Party, threatened against any of them, (b) are no strikes, lockouts, slowdowns or stoppage against any of the Parent or any Subsidiary thereof pending or,

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to the knowledge of any Responsible Officer of any Loan Party, threatened and (c) no union representation petition existing with respect to the employees of the Parent or any of its Subsidiaries and no union organizing activities are taking place.  The hours worked by and payments made to employees of the Parent and its Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable federal, state, provincial, local or foreign law dealing with such matters.  All payments due from the Parent or any of its Subsidiaries, or for which any claim may be made against the Parent or any Subsidiary thereof, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued as a liability on the books of the Parent or such Subsidiary.  The consummation of the Transactions will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which the Parent or any of its Subsidiaries is bound.

Section 4.18           Intellectual Property.  The Parent and each of its Subsidiaries owns or is licensed or otherwise has full legal right to use all of the patents, trademarks, service marks, trade names, copyrights, franchises, authorizations and other rights that are reasonably necessary for the operation of its business, without conflict with the rights of any other Person with respect thereto.

Section 4.19           Solvency.

(a)           Immediately after the consummation of the Transactions to occur on the Closing Date and immediately following the making of each Advance and after giving effect to the application of the proceeds of each Advance, (i) the fair value of the assets of each Loan Party (including rights of contribution) will exceed its debts and liabilities, subordinated, contingent or otherwise; (ii) the present fair saleable value of the Property of each Loan Party will be greater than the amount that will be required to pay the probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured; (iii) each Loan Party will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (iv) each Loan Party will not have unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted following the Closing Date.

(b)           The Parent does not intend to, or to permit any of its Subsidiaries to, and does not believe that it or any of its Subsidiaries will, on a consolidated basis, incur debts beyond its ability to pay such debts as they mature, taking into account the timing of and amounts of cash to be received by it or any such Subsidiary and the timing of the amounts of cash to be payable on or in respect of its Debt or the Debt of such Subsidiary.

Section 4.20           Margin Regulations.  None of the Parent or any of its Subsidiaries is engaged and will engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U), or extending credit for the purpose of purchasing or carrying margin stock.  No part of the proceeds of any Advance will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry any margin stock (within the meaning of Regulation U) or to refinance any Debt originally incurred for such purpose, or for any other purpose that entails a violation of, or

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that is inconsistent with, the provisions of the Regulations of the Board, including Regulation T, U or X.

Section 4.21           Investment Company Act.  None of the Parent or any of its Subsidiaries is an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

Section 4.22           Rig Construction Contracts.  There have been no extensions of the Delivery Dates without the prior written consent of the Joint Bookrunners in consultation with the Majority Lenders.  No Borrower has agreed to a reduction the variable load or to modify any of the specifications of any Rig without the prior written consent of the Joint Bookrunners in consultation with the Majority Lenders.

ARTICLE V
AFFIRMATIVE COVENANTS

So long as the Advances or any amount under any Loan Document shall remain unpaid, any Lender shall have any Commitment hereunder, or there shall exist any Letter of Credit Exposure, unless the Majority Lenders shall otherwise consent in writing, the Parent shall, and shall cause each other Loan Party to:

Section 5.01           Preservation of Existence, Etc.  Except as permitted by Section 6.03, (a) preserve, renew and maintain in full force and effect its legal existence and good standing under the Legal Requirements of the jurisdiction of its formation, (b) take all reasonable action to obtain, preserve, renew, extend, maintain and keep in full force and effect all rights, privileges, permits, licenses, authorizations and franchises necessary or desirable in the normal conduct of its business, and (c) qualify and remain qualified as a foreign entity in each jurisdiction in which qualification is necessary in view of its business and operations or the ownership of its Properties to the extent the failure to qualify could reasonably be expected to have a Material Adverse Effect.

Section 5.02           Compliance with Laws, Etc.  Comply in all material respects with all Legal Requirements applicable to it or to its business or property, except in such instances in which such Legal Requirement is being contested in good faith by appropriate proceedings diligently conducted.

Section 5.03           Maintenance of Property.  (a) Maintain and preserve all Property material to the conduct of its business and keep such Property in good repair, working order and condition, (b) from time to time make, or cause to be made, all needful and proper repairs, renewals, additions, improvements and replacements thereto necessary in order that the business carried on in connection therewith may be properly conducted at all times and (c) use the standard of care typical in the industry in the operation and maintenance of its facilities.  Notwithstanding the foregoing, if a Rig is affected by a Casualty Event or a Collateral Disposition, the applicable Borrower shall either make all necessary repairs and replacements to such affected Rig or apply the Casualty Proceeds or Collateral Disposition Proceeds therefrom as provided in Section 2.07(c)(iii) or (iv), as the case may be.

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Section 5.04           Maintenance of Insurance.

(a)           General.

(i)            Except as otherwise specifically provided below, at their own expense, maintain insurance payable in Dollars in amounts (and with co-insurance and deductibles), against all risks (including, without limitation, marine hull and machinery (including excess value) insurance, marine protection and indemnity insurance, drilling, towage, repossession, loss of hire, war and terrorist risks, protection and indemnity insurance, liability arising out of pollution and the spillage or leakage of cargo and cargo liability insurance and without any named windstorm exclusions) and in forms which are substantially equivalent to the coverage reflecting the customary and prudent practice of other responsible and experienced Persons of similar size and established reputation engaged in the same or similar operation of vessels similar to the Rigs and placed through brokers and with financially sound and reputable insurance companies or associations that are reasonably satisfactory to the Collateral Agent.

(ii)           Renew all such insurance, including, without limitation, the Insurance Policies, as they expire and so as to ensure that there is no gap in coverage, keep the Collateral Agent advised of the progress of such renewals, and shall provide evidence of such renewal in writing to the Collateral Agent within seven days of renewal.

(iii)          Punctually pay all premiums, calls, contributions or other sums payable in respect of such insurance, including, without limitation, the Insurance Policies, and produce all relevant receipts when so required by the Collateral Agent and all Insurance Policies shall provide that there shall be no recourse against the Collateral Agent or any other Secured Party for unpaid premiums, club calls, assessments or advances.

(iv)          Cause each insurance company, underwriter, club or fund (or an authorized agent thereof) to agree in writing to mark their records and to advise the Collateral Agent at least seven Business Days prior to the lapse of each policy or contract issued by such insurance company, underwriter, club or fund by expiration, termination, failure to renew or otherwise for any reason whatsoever and of any default in payment of any premium in respect of any Insurance Policy with respect to any Rig.  The Collateral Agent shall not be deemed to have knowledge of any such lapse of insurance in the absence of receipt of notice from such brokers.  If such Insurance Policies are not maintained in full force and effect, then the Collateral Agent, at its option, may procure such insurance at the Borrower’s expense.

(v)           Deliver to the Collateral Agent, upon the written request of the Collateral Agent, copies or, if requested by the Collateral Agent at any time and from time to time, the originals of all cover notes, binders, policies and certificates of entry in protection and indemnity associations, and all endorsements and riders amendatory thereof, in respect of Insurance Policies maintained in connection with the Rigs.

(vi)          Cause the Insurance Policies to provide for a deductible amount not in excess of $5,000,000 per occurrence.

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(vii)         Maintain insurance, if any, required by the Rig Construction Contracts from time to time.

(viii)        Provide to the Collateral Agent promptly after receiving them copies of any communications relating to (A) non-payment of premiums and cancellation of the Insurance Policies; and (B) the imposition of any exclusion or qualification or other material modification of the Insurance Policies.

(ix)           Do all things necessary and provide all documents, evidence and information within its power which may be reasonably requested by the Collateral Agent to enable the Collateral Agent to collect or recover any moneys which may at any time become due in respect of the Insurance Policies.

(b)           Terms of Insurance Policies.  The Insurance Policies shall include the following terms and conditions:

(i)            each Rig shall always be covered against marine perils and all risks of loss or damage, including loss, damage, fire and such other perils as are customary in the industry, in accordance with English, American or Norwegian hull clauses with reasonable deductibles as determined by the Parent but in no event in excess of $5,000,000;

(ii)           for the purposes of insurance against Total Loss, each Rig and its equipment and appurtenances shall be insured for and valued (for the avoidance of doubt being an agreed/assessed value as between the assured and the insurers) at an amount at least equal to 120% of the aggregate outstanding Tranche 1 Commitments, Tranche 2 Commitments, Tranche 3 Commitments or Tranche 4 Commitments, as applicable, with respect to each Rig;

(iii)          each Rig shall be covered against war and terrorist risks (including risks, whether or not regarded as war risks, excluded by the “Free of Capture and Seizure” clauses in the standard form of marine policy) in accordance with English, American or Norwegian clauses and incorporating protection and indemnity clause and with crew war risk insurance being effected separately, and all Rigs shall be covered for “strikes, riots and civil commotion” risk.  Such risks, may, at the option of the Parent, be insured by entering the Rigs in such war risk association or club reasonably acceptable to the Collateral Agent against all risks covered under the rules of such association or club and with reasonable deductibles provided therein;

(iv)          each Rig shall also be insured against protection and indemnity risks and liabilities, including, without limitation, the risk of pollution and spillage or leakage of oil or other cargo caused by such Rig, unless such risk is fully covered by the entry of the Rigs into an international group protection and indemnity association, in each case in an amount from time to time obtainable for vessels of the same type, size, age and flag as such Rig and carried by, and reflecting the customary and prudent practice of other responsible and experienced companies engaged in the operation of vessels similar to

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such Rig, but in any event shall be in an amount approved by the Facility Agent in consultation with the Insurance Advisor;

(v)           if any of the insurances referred to this in Section 5.04 form part of a fleet cover, the Parent shall procure that the brokers shall undertake to the Collateral Agent that such brokers shall neither set off against any claims in respect of a Rig any premiums due in respect of other Rigs under such fleet cover or any premiums due for other insurances, nor cancel the insurance for reason of non-payment of premiums for other Rigs under such fleet cover or of premiums for such other insurances; and

(vi)          if the Collateral Agent or the Majority Lenders determines on reasonable grounds that the Insurance Policies do not adequately protect the interests of the Secured Parties in relation to any Rig, it will consult with the relevant Borrower and the Insurance Advisor in order to agree any changes to the Insurance Policies that may be appropriate to protect the interest of the Secured Parties in relation to that Rig, provided that if the Collateral Agent and the relevant Borrower are unable to agree upon which changes may be appropriate, the relevant Borrower will comply with any further requirements relating to insurance recommended by the Insurance Advisor.

(c)           Mortgagee Interest Insurance.  The Collateral Agent shall, at the Loan Parties’ expense, obtain, for and on behalf of the Secured Parties, mortgagee’s interest insurance and mortgagee’s additional perils (pollution) insurance providing coverage which shall be at least 120% of the aggregate Tranche 1 Commitments, Tranche 2 Commitments, Tranche 3 Commitments or Tranche 4 Commitments, as applicable, with respect to each Rig.  Such insurance shall cover marine perils on hull and machinery, and shall be maintained in the broadest forms available (on reasonable commercial terms as reasonably acceptable to the Collateral Agent) in the American and British insurance markets or in such other major international markets acceptable to the Collateral Agent.

(d)           Collateral Agent as Additional Insured and Loss Payee.

(i)            In the case of all marine and war risk hull and machinery policies and all protection and indemnity insurances (including insurance against liability for pollution or the spillage or leakage of cargo), the Parent will cause the Collateral Agent for the benefit of the Secured Parties to be named as an additional insured as may be required by the Collateral Agent without liability for premiums or calls payable under such Insurance Policies.

(ii)           The Parent will cause all policies and certificates of entry with respect to insurance required hereby for each Rig to contain a loss payable clause which shall be on substantially the terms set forth in Schedule 5.04 hereto (or, if such terms are not obtainable, then such terms as shall, in the opinion of the Insurance Advisor be the best otherwise attainable), in the case of all marine and war risk hull and machinery (including excess values) policies and all protection and indemnity and liability and oil pollution liability insurance, and which shall: (A) in the case of protection and indemnity insurance, provide for payment to the applicable Borrower or its order unless the payment is to indemnify the Collateral Agent from or reimburse the Collateral Agent for any loss,

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damage or expense incurred by it or unless and until the insurers or associations receive notice from the Collateral Agent that the applicable Borrower is in default hereunder, in which event all payments shall be made to the Collateral Agent, provided, that the insurer may in all events make payments directly to third parties to whom liability has been established in discharge of guaranties issued by the insurer or claims against the applicable Borrower or insurer, and (B) in the case of all other insurance, provide for payment to the Collateral Agent to be applied in accordance with the terms of Section 2.07(c).

(iii)          In addition, the applicable Borrower will, at its sole cost and expense, (A) assign to the Collateral Agent, by an Assignment of Insurances, all of such Borrower’s right, title and interest in and to each Insurance Policy (including all entries in protection and indemnity or war risk associations) with respect to the insurance required hereby and furnish, or cause its brokers to furnish, written notice of such assignment to all insurers, underwriters, clubs and associations with respect to such insurance, and (B) cause the insurance brokers and club managers to hold to the order of the Collateral Agent the originals of all policies, contracts, binders, insurance slips, cover notes and certificates of entry relating to the Rigs and to deliver certified copies thereof on request and to execute and deliver to the Collateral Agent a letter of undertaking in connection with the above mentioned insurances and entries.

(iv)          With respect to any potential claims under any Insurance Policy, the Collateral Agent may, but shall not be required to, make proof of loss under, settle and adjust any claims under, or direct the applicable Borrower to take such actions at the reasonable direction of the Collateral Agent, and the expenses incurred by the Collateral Agent in the adjustment and collection of such proceeds shall be paid by such Borrower, provided, that if no Event of Default exists, the Collateral Agent shall give the applicable Loan Party written notice and opportunity to perform prior to itself performing or causing to perform.  The Collateral Agent shall not be liable or responsible for failure to collect or exercise diligence in the collection of any proceeds, unless directly caused by its gross negligence or willful misconduct.

(e)           Application of Payments under Insurance Policies.  All Casualty Proceeds or Collateral Disposition Proceeds received by such Loan Party or the Collateral Agent as a result of a Casualty Event or Collateral Disposition shall be applied in accordance with the requirements of Sections 2.07(c)(iii) or (iv), as the case may be.

(f)            Operation of Rigs.

(i)            Each Borrower agrees that it will not do or permit or willingly allow to be done any act by which any insurance or entry required by this Section 5.04 may be suspended, impaired or cancelled, and that it will not permit or allow any Rig to undertake any voyage or run any risk or transport any cargo which may not be permitted by the policies in force, without having previously insured such Rig by additional coverage to extend to such voyages, risks or cargoes.

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(ii)           No Borrower will cause or permit any Rig to operate or undertake a voyage to or to sail in any area which has been declared a war area by the relevant underwriters and insurance companies and has been included in the list of exclusions from time to time in effect attached to the War Risks Insurance Policies in the form of the War Risks Trading Warranties, without first notifying thereof the Collateral Agent and the War Risks underwriters of such Rig and paying any additional insurance premiums required. Each Borrower agrees that it will promptly furnish to the Collateral Agent, upon written request by the Collateral Agent, evidence of payment of such additional premiums.

(iii)          Each Borrower will comply with and satisfy all of the provisions of any applicable Legal Requirement concerning financial responsibility for liabilities imposed on such Borrower or the Rigs with respect to pollution by any state or nation or political subdivision thereof and will maintain all certificates or other evidence of financial responsibility as may be required by any such law, convention, regulation, proclamation or order with respect to the trade which each Rig is from time to time engaged in and the cargo carried by it.

(g)           United States Operations.  At all times during which one or more Rigs is operating within the jurisdiction of the United States of America, the Loan Parties shall maintain with respect to such Rigs:

(i)            insurance or post bonds or maintain approved evidence of financial responsibility (including, without limitation, qualification as a “qualified self-insurer” by the United States Coast Guard) with respect to such Rigs to cover the actual cost of removal of discharged oil for which such Loan Party or the Collateral Agent may be held strictly liable (or held liable due to negligence of such Loan Party or any other Person) under the Clean Water Act of 1977, as amended, the Oil Pollution Act 1990 (33 U.S.C. § 2701 et seq.), as amended, or the Outer Continental Shelf Lands Act, as amended, or under any other Legal Requirement, including, without limitation, any Environmental Law, of any Governmental Authority that, now or in the future, may apply to such Rigs or to the Loan Parties, such Rigs or their operations; and

(ii)           such worker’s compensation or longshoremen’s and harbor workers’ insurance as shall be required by applicable law, including endorsements for foreign and Outer Continental Shelf operations, borrowed servant, voluntary compensation and in rem claims.

Section 5.05           Payment of Taxes, Etc.  Pay and discharge as the same shall become due and payable, all its obligations and liabilities in accordance with their terms, including (a) all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in respect of its Property, (b) all lawful claims which, if unpaid, might by law become a Lien upon its Property; and (c) all Debt, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such Debt, in each case, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Parent or such Subsidiary.

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Section 5.06           Reporting Requirements.  Deliver to the Facility Agent (who shall promptly deliver to the Lenders), in form and detail satisfactory to the Facility Agent and the Majority Lenders:

(a)           Audited Annual Financials.  As soon as available and in any event not later than 120 days after the end of each fiscal year of the Parent, (i) a consolidated balance sheet of the Parent and its Subsidiaries as at the end of such fiscal year, and related statements of operations, shareholders equity and cash flows, all in reasonable detail and prepared in accordance with GAAP, audited and accompanied by a report and opinion of an independent registered public accountant of nationally recognized standing reasonably acceptable to the Majority Lenders, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any “going concern” or like qualification or exception or any qualification or exception as to the scope of such audit, and (ii) the consolidating balance sheets and consolidating statements of income or operations for the Parent and OGIL and its Subsidiaries for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year accompanied  by a review report from the independent registered public accountant stating that such financial statements were included in the audit of the Parent, have been reviewed by the independent registered public accountant, and that there are no known adjustments which would be required to make these consolidating financial statements not misleading;

(b)           Quarterly Financials.  As soon as available and in any event not later than 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Parent, a consolidated and consolidating balance sheet of the Parent and its Subsidiaries as at the end of such fiscal quarter, and the related consolidated and consolidating statements of income or operations and cash flows for such fiscal quarter and for the portion of the Parent’s fiscal year then ended, setting forth in each case in comparative form the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail and certified by a Responsible Officer of the Parent as fairly presenting the financial condition, results of operations and cash flows of the Parent and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes;

(c)           Compliance Certificates.  Concurrently with the delivery of the financial statements referred to in Sections 5.06(a) and (b), a duly completed Compliance Certificate signed by a Responsible Officer of the Parent;

(d)           Excess Cash Flow Certificate.  As soon as available and in any event not later than 45 days after the end of each fiscal quarter of each Borrower, a duly completed Excess Cash Flow Certificate with respect to each Borrower signed by a Responsible Officer of the Parent;

(e)           Management Letters.  Promptly upon receipt thereof, copies of any detailed audit reports, management letters or recommendations submitted to the board of directors (or the audit committee of the board of directors) of the Parent by independent accountants in connection with the accounts or books of the Parent or any Subsidiary thereof, or any audit of any of them;

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(f)            Budgets.  On or before 120 days after the commencement of each fiscal year of the Parent, (i) a consolidated and consolidating budget of the Parent and its Subsidiaries which includes consolidated and consolidating income statements, balance sheets and cash flow statements of the Parent and its Subsidiaries for each of the four fiscal quarters of such fiscal year and (ii) a breakdown of projected revenues, operating expenses, utilizations and capital expenditures for each Rig;

(g)           Projections.  On or before 120 days after the commencement of each fiscal year of the Parent, updated Projections for the five year period commencing as of such fiscal year;

(h)           Rig Appraisal Reports.

(i)            Within 45 days after each (A) June 30, commencing with the first June 30^th occurring after Rig 1 Delivery Date, two written appraisal reports prepared by two independent Approved Rig Appraisers with respect to the Rigs that have been delivered as of such date and (B) December 31, commencing with the first December 31^st occurring after Rig 1 Delivery Date, a desktop appraisal with respect to the Rigs that have been delivered as of such date, each in form, scope and methodology acceptable to Facility Agent, setting forth the Market Value of each of the Rigs as of the date appraised (each a “Rig Appraisal Report”).  The cost of each such Rig Appraisal Report shall be paid by the Borrower;

(ii)           Upon the written request of the Majority Lenders, additional Rig Appraisal Reports within 30 days after receipt of such request. Unless an Event of Default is in existence at the time of such request, the Lenders shall pay the costs of any Rig Appraisal Reports requested by the Majority Lenders other than those required under Section 5.06(h)(i) during such calendar year;

(iii)          Within 30 days after the occurrence of any Casualty Event (if the Casualty Proceeds with respect thereto could reasonably be expected to exceed U.S.$25,000,000) or any Collateral Disposition occurring with respect to any Rig, an additional Rig Appraisal Report setting forth the Market Value of the affected Rig immediately prior to such Casualty Event or Collateral Disposition and the Market Value giving effect to such Casualty Event or Collateral Disposition (an “Additional Appraisal Report”). The cost of each such Additional Appraisal Report shall be paid by the Borrower;

(iv)          Each Rig Appraisal Report and Additional Appraisal Report delivered under this Section 5.06 shall be in form, scope and substance reasonably satisfactory to the Facility Agent;

(i)            Rig Report.  On or before 45 days after the end of each of fiscal quarter of each fiscal year of the Parent, a report detailing (i) the then current location of each of the Rigs, and the then current term of and parties to any drilling contract of any such Rigs and (ii) for the previous fiscal quarter, the average day rates and utilization for each such Rig;

(j)            Insurance Broker Reports.  As soon as available and in any event not later than 90 days after the end of each fiscal year of the Parent that occurs after the first Delivery Date, a detailed report prepared by the Insurance Advisor, at the joint and several expense of the

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Borrowers, which report (i) lists all Insurance Policies then in effect with respect to the Rigs, (ii) specifies for each such Insurance Policy (A) the amount thereof, (B) the risks insured against thereby, (C) the name of each direct or indirect or participating insurer or underwriter and each insured party thereunder, (D) the policy or other identification number thereof and (E) the expiration date and (iii) certifies that all such Insurance Policies are (A) in full force and effect, (B) placed with such insurance companies, underwriters or associations, in such amounts, against such risks, and in such form, as are normally issued against by Persons of similar size and established reputation engaged in the same or similar businesses and similarly situated and as are necessary or advisable for the protection of the Collateral Agent as mortgagee, (C) arranged in the broadest form generally available in the United States, British, or Scandinavian insurance markets, and (D) conforming to the requirements of this Agreement;

(k)           Safety Management Manual.  Upon written request by the Facility Agent, a copy of the safety management manual used to describe and implement the Parent’s safety management system developed, implemented and maintained in compliance with the ISM Code, if applicable;

(l)            Securities Law Filings and other Public Information.  Promptly after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent to the stockholders of the Parent, and copies of all annual, regular, periodic and special reports and registration statements which the Parent may file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to be delivered to the Facility Agent pursuant hereto;

(m)          USA Patriot Act.  Promptly, following a written request by any Lender, all documentation and other information that such Lender reasonably requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act; and

(n)           Other Information.  Such other information respecting the business or Properties, or the condition or operations, financial or otherwise, of the Parent and its Subsidiaries as the Facility Agent or any Lender may from time to time reasonably request.

Documents required to be delivered pursuant to Sections 5.06(a) or (b) or Section 6.02(k) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Parent posts such documents, or provides a link thereto on the Parent’s website on the Internet at the website address listed on Schedule 10.02; or (ii) on which such documents are posted on the Parent’s behalf on an Internet or intranet website, if any, to which each Lender and the Facility Agent have access (whether a commercial, third-party website or whether sponsored by the Facility Agent); provided that: (i) the Parent shall deliver paper copies of such documents to the Facility Agent or any Lender that requests the Parent to deliver such paper copies until a written request to cease delivering paper copies is given by the Facility Agent or such Lender and (ii) the Parent shall notify the Facility Agent and each Lender (by telecopier or electronic mail) of the posting of any such documents and provide to the Facility Agent by electronic mail electronic versions (i.e., soft copies) of such documents.  The Facility Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to

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above, and in any event shall have no responsibility to monitor compliance by the Parent with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

Section 5.07           Other Notices.  Deliver to the Facility Agent and each Lender prompt written notice of the following:

(a)           Defaults.  The occurrence of any Default or Event of Default;

(b)           Litigation.  The filing or commencement of, or any probable threat or notice of intention of any Person to file or commence, any action, suit or proceeding (other than tax assessments), whether at law or in equity or by or before any Governmental Authority, against the Parent or any Subsidiary or Affiliate thereof that could reasonably be expected to result in liability of the Parent or any of its Subsidiaries in an aggregate amount exceeding $10,000,000;

(c)           ERISA Events.  The occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in liability of the Parent or any of its Subsidiaries in an aggregate amount exceeding $1,000,000;

(d)           Environmental Notices.  Promptly upon, and in any event within five Business Days after, a Responsible Officer of any Loan Party obtains knowledge thereof, written notice of any of the following environmental matters: (i) a copy of any form of notice, summons or citation received from any Governmental Authority or any other Person, concerning (A) material violations or alleged violations of Environmental Laws, which seeks to impose liability therefor, (B)  any notice of potential responsibility under any Environmental Law, or (C)  the filing of a Lien other than a Permitted Lien upon, against or in connection with the Parent or any of its Subsidiaries, or any of the Rigs, (ii) any condition or occurrence on or arising from any Rig that (A) results in noncompliance by any Loan Party with any applicable Environmental Law or (B) could reasonably be expected to form the basis of an Environmental Claim against any Loan Party or any such Rig, in each case that could reasonably be expected to result in a liability of the Parent or any of its Subsidiaries in an aggregate amount exceeding $10,000,000; (iii) any condition or occurrence on any Rig that could reasonably be expected to cause such Rig to be subject to any restrictions on the ownership, occupancy, use or transferability by any Loan Party of such Rig under any Environmental Law; and (iv) the taking of any removal or remedial action in response to the actual or alleged presence of any Hazardous Material on any Rig as required by any Environmental Law or any Governmental Authority;

(e)           Collateral.  Furnish to the Collateral Agent prompt (and in any event within 30 days) written notice of:

(i)            any change in any Loan Party’s corporate name, identity, corporate structure or jurisdiction of formation;

(ii)           any construction delay, default, claim of indemnity or force majeure, request for variation or notice of compulsory changes under any of the Transaction Documents, including, without limitation the Rig Construction Contracts;

(iii)          any notice of default, suspension or cancellation of any drilling contract;

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(iv)          any Collateral Disposition;

(v)           any Casualty Event in excess of $10,000,000;

(vi)          any material requirement made by any insurer or classification society or by any competent authority which is not complied with within a reasonable time; and

(vii)         any arrest of any Rig or the exercise or purported exercise of any Lien on any Rig;

(f)            Material Changes.  Any development that has resulted in, or could reasonably be expected to result in, a Material Adverse Effect;

Each notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer of a Loan Party setting forth details of the occurrence referred to therein and stating what action such Loan Party has taken and proposes to take with respect thereto.  Each notice pursuant to Section 5.07(a) shall describe with particularity any and all provisions of this Agreement and any other Loan Document that have been breached.

Section 5.08           Books and Records; Inspection.  (a) Keep proper records and books of account in which full, true and correct entries will be made in accordance with GAAP and all Legal Requirements, reflecting all financial transactions and matters involving the assets and business of the Parent and its Subsidiaries; (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over the Parent and its Subsidiaries; and (c) from time-to-time during regular business hours upon reasonable prior notice, (i) permit representatives and independent contractors of each Mandated Lead Arranger to visit and inspect any of its Properties one time during each calendar year, (ii) to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom and (iii) to discuss its affairs, finances and accounts with its directors, officers, and independent public accountants, all at the expense of the Borrowers and at such reasonable times during normal business hours and as often as may be reasonably desired, upon reasonable advance notice to the Parent; provided, however, that if an Event of Default has occurred and is continuing, the Facility Agent or any Lender (or any of their respective representatives or independent contractors) may do any of the foregoing at the expense of the Borrowers at any time during normal business hours and without advance notice.

Section 5.09           Use of Proceeds.

(a)           Use the proceeds of the Term Advances to finance the construction of the Rigs or to reimburse the applicable Borrower for moneys utilized from funds held in trust to finance the construction of the Rigs.

(b)           Use the proceeds of the Top-Up Advances for general corporate purposes, including without limitation, making Restricted Payments to the extent permitted by Section 6.06.

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(c)           Use the proceeds of the Revolving Advances for working capital, issuance of letters of credit and for other general corporate purposes; provided, however, that the Revolving Advances cannot be used to make deposits into the Debt Service Reserve Accounts.

Section 5.10           Nature of Business.  Remain primarily engaged in any of (a) the contract drilling business, and (b) any related or ancillary businesses.

Section 5.11           Operation of Rigs.

(a)           (i) Comply with and satisfy all Legal Requirements of the jurisdiction of such Rig’s home port, now or hereafter from time to time in effect, in order that such Rig shall continue to be documented pursuant to the laws of the jurisdiction of its home port with such endorsements as shall qualify such Rigs for participation in the trades and services to which it may be dedicated from time to time or (ii) not do or allow to be done anything whereby such documentation is or could reasonably be expected  be forfeited;

(b)           The applicable Borrower and each other Loan Party which owns or operates, or will own or operate, one or more Rigs will, at all times while owning or operating such Rigs, be qualified to own and operate such Rigs under the laws of the jurisdiction of such Rig’s registry;

(c)           Keep such Rig in a good and sufficient state of repair consistent with first-class ship-ownership and management practice employed by owners of vessels of similar size and type and so as to maintain the present class of such Rig at its current classification by any first-class, recognized rating agency, including, without limitation, the American Bureau of Shipping, free of recommendations affecting class and qualifications and change of class;

(d)           (i) Make or cause to be made all repairs to or replacement of any damaged, worn or lost parts or equipment such that the value of such Rig will not be materially impaired and (ii) except as otherwise contemplated by this Agreement, not remove any material part of, or item of equipment owned by the Loan Parties installed on, such Rig except in the ordinary course of the operation and maintenance of such Rig or unless (A) the part or item so removed is forthwith replaced by a suitable part or item which is in the same condition as or better condition than the part or item removed, is free from any Lien (other than Permitted Prior Liens) in favor of any Person other than the Collateral Agent and becomes, upon installation on such Rig the property of the Loan Parties and subject to the security constituted by the Rig Mortgage or the Security Agreement or (B) the removal will not materially diminish the value of such Rig;

(e)           Submit such Rig to such periodical or other surveys as may be required for classification purposes and, upon the written request of the Collateral Agent supply to the Collateral Agent copies of all survey reports and classification certificates issued in respect thereof;

(f)            Promptly pay and discharge all debts, damages and liabilities whatsoever which have given or may give rise to maritime or possessory Liens (other than Permitted Prior Liens) on or claims enforceable against such Rig and all tolls, dues, taxes, assessments, governmental charges, fines and penalties that are material in amount and lawfully charged on or in respect of each Rig other than any of the foregoing being contested in good faith and diligently by appropriate proceedings, and, in the event of arrest of any Rig pursuant to legal process, or in the

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event of its detention in exercise or purported exercise of any such Lien or claim as aforesaid, procure, if possible, the release of such Rig from such arrest or detention forthwith upon receiving notice thereof by providing bail or otherwise as the circumstances may require;

(g)           Maintain, or cause to be maintained by the charterer or lessee of any Rig, a valid Certificate of Financial Responsibility (Oil Pollution) issued by the United States Coast Guard pursuant to the Federal Water Pollution Control Act to the extent that such certificate may be required by applicable Legal Requirements for any Rig and such other similar certificates as may be required in the course of the operations of any Rig pursuant to the International Convention on Civil Liability for Oil Pollution Damage of 1969, or other applicable Legal Requirements;

(h)           If the Person operating such Rig is not a Loan Party, promptly remit all earnings received by such Person from any Rig back to the appropriate Loan Party.  For the avoidance of doubt, “earnings” does not include operating costs and reasonable management fees as are customary in the industry and which are set forth and supported by a budget for such Rigs which will be delivered to the Facility Agent on or before such time as the subject Rig begins operations for such Person; and

(i)            Cause such Rigs to be managed by the Parent or one of the Loan Parties, or such other international, independent manager of established reputation engaged in the same or similar operation of vessels similar to the Rigs, as consented to by the Facility Agent acting upon instruction from the Majority Lenders.

Section 5.12           Additional Guarantors.  Notify the Facility Agent at the time that any Person becomes a Subsidiary of the Parent (other than an Excluded Entity), and promptly thereafter (and in any event within 30 days), (a) cause such Person to (i) become a Guarantor by executing and delivering to the Facility Agent such document as the Facility Agent shall deem appropriate for such purpose, (ii) deliver to the Facility Agent documents of the types referred to in clauses Section 3.01(a)(vi), (vii), (viii), and (ix) and favorable opinions of counsel to such Person (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in clause (i)), all in form, content and scope reasonably satisfactory to the Facility Agent and (iii) execute such other Security Documents as the Collateral Agent or any Lender may reasonably request, in each case to secure the Obligations and (b) cause the stockholder of such Person to execute a Pledge Agreement pledging 100% of its interests in the Equity Interest of such Person to secure the Obligations and such evidence of corporate authority to enter into and such legal opinions in relation to such Pledge Agreement as the Collateral Agent may reasonably request, along with share certificates pledged thereby and appropriately executed stock powers in blank.

Section 5.13           Further Assurances in General.  (a) Execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements, mortgages, and other documents), which may be required under any Legal Requirement, or which the Facility Agent, the Collateral Agent or the Majority Lenders may reasonably request, all at the expense of the Loan Parties, (b) provide to the Collateral Agent, from time to time upon written request, evidence reasonably satisfactory to the Collateral Agent as to the perfection and priority of the Liens created or intended to be created by the Security Documents, (c) not effect or permit any change referred to in Section 5.07(e) 

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unless all filings have been made under the Uniform Commercial Code or otherwise that are required in order for the Collateral Agent to continue at all times following such change to have, and (d) take all necessary action to ensure that the Collateral Agent does continue at all times to have, a valid, legal and perfected security interest in all the Collateral.  Each Loan Party hereby authorizes the Collateral Agent to file one or more financing or continuation statements under the UCC (or any non-U.S. equivalent thereto), and amendments thereto, relative to all or any part of the Collateral without the signature of such Loan Party, where permitted by law.

Section 5.14           Delivery Date Collateral Requirements.  Within 10 Business Days prior to the Delivery Date for any Rig:

(a)           Deliver to the Collateral Agent, copies of each of the following:

(i)            a certificate stating (A) the name, registered owner, official number, the International Maritime Organization Number (if any), class and jurisdiction of registration, which shall be an Acceptable Flag Jurisdiction; and (B) that the Rig has been delivered to the applicable Borrower, completed in accordance with the applicable Rig Construction Contract, and such Rig has all certifications or licenses required for the intended operation of such Rig;

(ii)           the on-site report of the Technical Advisor confirming that the Rig has been completed in accordance with the Specifications (as defined in the Rig Construction Contract);

(iii)          copies of the various documents to be delivered by the Shipyard to the applicable Borrower in connection with delivery of such Rig as specified in Article IX of the Rig Construction Contract, including a copy of the Shipyard declaration of warranty confirming that good and marketable title to the Rig is being transferred to the applicable Borrower free and clear of all Liens;

(iv)          (i) certificates of ownership or abstracts of title from appropriate authorities showing (or confirmation updating previously reviewed certificates and indicating) the registered ownership of such Rig by the relevant Borrower, (ii) valid and current ISM/ISPS Code documentation required with respect to such Rig pursuant to applicable Legal Requirements, and (iii) the results of maritime registry searches with respect to such Rig, indicating no record liens other than Liens in favor of the Collateral Agent and Permitted Prior Liens;

(v)           evidence that such Rig has received the highest classification from the classification society issuing such class and the conditions and recommendations of such classification society with respect to such Rig shall be satisfactory to the Facility Agent in its reasonable discretion;

(vi)          a Rig Appraisal Report dated no more than 45 days prior to such Delivery Date (procured at the expense of the Borrower) with respect to such Rig;

(vii)         a Rig Mortgage duly authorized, executed and delivered by the applicable Borrower granting a Lien to the Collateral Agent in such Rig to secure the Obligations,

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together with any other documents, agreements or instruments necessary to create an Acceptable Security Interest in such Rig, in appropriate form for recording in the appropriate vessel registry and otherwise effective to create in favor of the Collateral Agent a legal, valid and enforceable first priority security interest, in and Lien upon such Rig, subject only to Permitted Prior Liens;

(viii)        All filings, deliveries of instruments and other actions necessary or desirable in the reasonable opinion of the Collateral Agent to perfect and preserve such security interests shall have been duly effected and the Collateral Agent shall have received evidence thereof in form and substance reasonably satisfactory to the Collateral Agent; recorded in the appropriate vessel registry;

(ix)           an Assignment of Earnings and an Assignment of Insurances, together covering all of such Loan Party’s present and future Earnings Collateral and Insurance Collateral;

(x)            a report, in form and scope reasonably satisfactory to the Collateral Agent, from the Insurance Advisor with respect to the Insurance Policies in effect with respect to such Rig, specifying for each such Insurance Policy the amount thereof, the risks insured against thereby, the name of the insurer and each insured party thereunder and the policy or other identification number thereof, together with a certificate from such Insurance Advisor certifying that all such Insurance Policies (i) are in full force and effect, (ii) are placed with such insurance companies, underwriters or associations, in such amounts, against such risks, and in such form, as are normally issued against by Persons of similar size and established reputation engaged in the same or similar businesses and similarly situated and as are necessary or advisable for the protection of the Collateral Agent as mortgagee and (ii) conform with the insurance requirements of Section 5.04;

(xi)           copies of the Certificates of Inspection, Vessel Certificates of Financial Responsibility (Water Pollution) or International Oil Pollution Prevention Certificate, each issued by the United States Coast Guard (or the substantial equivalent in the case of foreign assets if available), Certificates of Classification issued by the American Bureau of Shipping, Certificates of Documentation or Certificates of Registry issued by the United States Coast Guard or foreign equivalent, and International Load Line Certificates issued by the American Bureau of Shipping as requested by the Facility Agent with respect to the Rigs, and the Facility Agent shall be reasonably satisfied with the contents thereof;

(xii)          evidence of corporate authority to enter into such Loan Documents and written opinions from (A) maritime counsel to Borrower addressed to the Collateral Agent and each of the Lenders which shall (i) be in form and substance reasonably acceptable to the Collateral Agent and (ii) cover (v) the legal authority of the applicable Borrower to own and document such Rig under the laws of the jurisdiction of registration, (w) such Borrower’s ownership of record of such Rig, (x) the due filing of the Rig Mortgage in the appropriate office of the jurisdiction of registration and affirmation that such office is the only office in which the filing and recording of the Rig Mortgage is necessary, (y) the character of the Rig Mortgage as a “preferred mortgage”

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under the laws of the jurisdiction of registration, and (z) the absence of any Liens of record on the Rig recorded prior in time to the Rig Mortgage, and (B) Cayman counsel to such Borrower addressed to the Collateral Agent and each of the Lenders in form and substance reasonably acceptable to the Collateral Agent regarding due execution, delivery and enforceability of the Rig Mortgage and other related Security Documents and such other matters incident thereto as the Collateral Agent may reasonably request;

(xiii)         evidence that all sales, import, and use taxes have been paid in connection with such Rig; and

(xiv)        such other documents, certificates and opinions as the Collateral Agent shall have reasonably requested.

(b)           Cause to be established with the Collateral Agent or, if expressly permitted below, another financial institution reasonably acceptable to the Collateral Agent by the applicable Borrower each of the following accounts:

(i)            Earnings Account.  The applicable Borrower shall cause the earnings derived from its respective Rig, to the extent constituting Earnings Collateral, to be deposited by the respective account debtor in respect of such earnings into an interest bearing account maintained for such Borrower from time to time with the Collateral Agent or another financial institution reasonably acceptable and located in a jurisdiction reasonably acceptable to the Collateral Agent subject to an Account Control Agreement (such account, the “Earnings Account”). Without limiting any Loan Party’s obligations in respect of this Section 5.14(b), each Loan Party agrees that, in the event it receives any earnings constituting Earnings Collateral, or any such earnings are deposited other than in one of the Earning Accounts, it shall promptly deposit all such proceeds into the Earnings Account maintained for such Borrower from time to time.

(ii)           Retention Account.  The applicable Borrower shall establish an interest bearing account subject to an Account Control Agreement with the Collateral Agent (such account, the “Retention Account”) into which each Borrower will transfer monthly, until the applicable Tranche of Advances have been repaid in full, from the Earnings Account an amount equal to one-third of the amount of Debt Service of the applicable Tranche of Advances necessary for the next succeeding Payment Date.

(iii)          Debt Service Reserve Account. The applicable Borrower shall establish an interest bearing account subject to an Account Control Agreement with the Collateral Agent (such account, the “Debt Service Reserve Account”) in which each Borrower will maintain, at all times until the applicable Tranche of Advances have been repaid in full, deposits in an amount equal to at least three months of Debt Service of the applicable Tranche of Advances.  Any amounts deposited in the Debt Service Reserve Account may be applied to the Debt Service of any other sum payable under this Agreement, but only if: (A) there are no funds available for such payment in any Earnings Account or the Retention Account; (B) there are no Unused Revolving Commitments under such Borrower’s Tranche and (C) on terms that such Borrower shall repay to the Debt Service Reserve Account the amount so withdrawn on or before the next Payment Date following

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such withdrawal.  So long as no Default or Event of Default has occurred and is continuing, any amounts in excess of those amounts required to be deposited in the Debt Service Reserve Account will be refunded to the Earnings Account upon the written request of the Borrower.

Section 5.15           Drilling Contracts.

(a)           Unless otherwise consented to by each of the Joint Bookrunners and the Majority Lenders, upon each applicable Delivery Date, each Borrower must establish with respect to its Rig at least 15 months of Debt Service, as determined by the Joint Bookrunners, through a combination of (A) anticipated earnings from executed firm drilling contracts with respect to such Rig and (B) cash deposits into the Debt Service Reserve Account.

(b)           Unless otherwise consented to by each of the Joint Bookrunners and the Majority Lenders, each Rig must maintain employment pursuant to executed drilling contracts acceptable to the Joint Bookrunners in consultation with the Majority Lenders for at least 12 months, whether or not consecutive, during any consecutive period of 18 months during the term of this Agreement.

(c)           In connection with any drilling contract having an indicated duration of at least twelve (12) months (including any optional extensions or renewals), the applicable Loan Party shall, at its own cost and expense, promptly and duly execute and deliver to the Collateral Agent a Charter Assignment in respect of such drilling contract, and will use its commercially reasonable efforts to cause the charterer under such charter party to execute and deliver to the Collateral Agent a consent to the Charter Assignment substantially in the form attached thereto.

Section 5.16           Separate Existence.  Comply with the following undertakings:

(a)           maintain its books, financial records and accounts, including checking and other bank accounts and custodian and other securities safekeeping accounts, separate and distinct from those of the other Loan Parties;

(b)           maintain its books, financial records and accounts (including inter-entity transaction accounts) in a manner so that it will not be difficult or costly to segregate, ascertain or otherwise identify their assets and liabilities separate and distinct from the assets and liabilities of the other Loan Parties;

(c)           not commingle any of its assets, funds, liabilities or business functions with the assets, funds, liabilities or business functions of the other Loan Parties;

(d)           observe all requisite organizational procedures and formalities, including the holding of meetings of the boards of directors as required by its organizational documents, the recordation and maintenance of minutes of such meetings, and the recordation of and maintenance of resolutions adopted at such meetings;

(e)           not be consensually merged or consolidated with the other Loan Parties (other than for financial reporting purposes);

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(f)            all transactions, agreements and dealings between the Loan Parties (including, in each case, transactions, agreements and dealings pursuant to which the assets or property of one is used or to be used by the other), will reflect the separate identity and legal existence of each such Person;

(g)           transactions between any of the Loan Parties, on the one hand, and any third parties, on the other hand, will be conducted in the name of such Loan Party, as applicable, as an entity separate and distinct from the other Loan Parties;

(h)           to the extent that any of the Loan Parties jointly contract or do business with vendors or service providers or share overhead expenses, the costs and expenses incurred in so doing will be fairly and non-arbitrarily allocated between or among such entities, with the result that each such entity bears its fair share of all such costs and expenses;

(i)            to the extent that any of the Loan Parties contracts or does business with vendors or service providers where the goods or services are wholly or partially for the benefit of the other, then the costs incurred in so doing will be fairly and non-arbitrarily allocated to the entity for whose benefit the goods or services are provided, with the result that each such entity bears its fair share of all such costs;

(j)            each Borrower shall have unaudited annual financial statements prepared that are separate from the other Loan Parties, which shall be certified by an authorized representative of such Borrower, as applicable, as fairly representing, in accordance with GAAP (subject to the absence of footnotes), the financial position of such Borrower;

(k)           none of the Loan Parties will make any inter-entity loans, advances, guarantees, extensions of credit or contributions of capital to, from or for the benefit of any Borrower, respectively, without proper documentation and accounting in accordance with GAAP and such Debt shall comply with the requirements of Section 6.02(b) below; and

(l)            the Loan Parties will not refer to any Borrower as a department or division of any Loan Party and will not otherwise refer to any Borrower in a manner inconsistent with its status as a separate and distinct legal entity.  In addition, each of the Borrowers will hold itself out as separate and distinct from the other Loan Parties.

Section 5.17           Post-Closing Requirements.  Either on or before June 30, 2008 or the receipt by the Parent of an Enforcement Notice (as defined in the Pledge Agreement), whichever occurs first, (a) cause each of the Parent, OGIL, Vantage Int’l Payroll (Caymans), Vantage Int’l Management (Caymans), Vantage Driller I and Vantage Driller II to amend its Articles of Association in form and substance reasonably satisfactory to the Facility Agent and (b) register the special resolution giving effect to the amendment to the articles as required herein with the Registrar of Companies in the Cayman Islands.

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ARTICLE VI
NEGATIVE COVENANTS

So long as the Advances or any amount under any Loan Document shall remain unpaid, any Lender shall have any Revolving Commitment, or there shall exist any Letter of Credit Exposure, unless the Majority Lenders otherwise consent in writing, the Parent shall not, and shall not permit any other Loan Party to:

Section 6.01           Liens, Etc.  Create, assume, incur or suffer to exist, any Lien on or in respect of any of its Property whether now owned or hereafter acquired, other than the following (“Permitted Liens”):

(a)           Liens pursuant to any Loan Document;

(b)           Liens for taxes, assessments or governmental charges or levies on its Property if the same shall not at the time be delinquent or thereafter can be paid without penalty, or are being contested in good faith and by appropriate proceedings diligently conducted and for which adequate reserves in accordance with GAAP shall have been set aside on its books;

(c)           Inchoate Liens arising under ERISA and Liens incurred and pledges or deposits made in the ordinary course of business in connection with worker’s compensation, unemployment insurance or other social security or retirement benefits, or similar legislation, other than any Lien imposed by ERISA;

(d)           Permitted Prior Liens;

(e)           Pledges and Liens on deposits, investment accounts, cash and Cash Equivalents to secure the performance of bids, trade contracts and leases (other than Debt), statutory obligations, surety bonds (other than bonds related to judgments or litigation), appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business; provided that the Debt secured by such Liens is permitted under Section 6.02 below;

(f)            Liens arising out of judgments or awards not constituting an Event of Default under Section 7.01(f), and prejudgment Liens created by or existing from any litigation or legal proceeding, in each case in respect of which the Parent or any of the Subsidiaries shall in good faith be prosecuting an appeal or proceedings for review in respect of which there shall be secured a subsisting stay of execution pending such appeal or proceedings for which adequate reserves have been made to the extent required by GAAP;

(g)           rights of set-off of banks and other Persons in the ordinary course of banking and trading arrangements;

(h)           Liens securing Debt permitted under Section 6.02(f) and (h); provided that (i) such Liens do not at any time encumber any property other than the property financed by such Debt and (ii) the Debt secured thereby does not exceed the cost or fair market value, whichever is lower, of the property being acquired on the date of acquisition;

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(i)            purchase money security interests in real property, improvements thereto or equipment hereafter acquired (or, in the case of improvements, constructed) by the Loan Parties or any Subsidiary; provided that (i) such security interests secure Debt permitted by Section 6.02, (ii) such security interests are incurred, and the Debt secured thereby is created, within 90 days after such acquisition (or construction), (iii) the Debt secured thereby does not exceed the lesser of the cost or the fair market value of such real property, improvements or equipment at the time of such acquisition (or construction) and (iv) such security interests do not apply to any other property or assets of the Loan Parties or any Subsidiary;

(j)            Liens securing the Drillship Debt; provided, however, that such Liens do not encumber any Collateral;

(k)           Carriers’, warehousemen’s, landlords’, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business which are not overdue for a period of 90 days or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person; and

(l)            other Liens securing obligations, actual or contingent, in an aggregate amount not greater than $2,500,000 at any time.

Section 6.02           Debts, Guaranties and Other Obligations.  Create, assume, suffer to exist or in any manner become or be liable, in respect of any Debt except:

(a)           Debt under the Loan Documents;

(b)           unsecured Debt owing by any Loan Party to the Parent or any other Loan Party; provided that (i) such Debt shall constitute Collateral under the Security Agreement, (ii) be on terms (including subordination terms) acceptable to the Facility Agent and (iii) be otherwise permitted under the provisions of Section 6.05;

(c)           Guarantees of the Parent or any Subsidiary in respect of Debt otherwise permitted hereunder of the Parent or any other Loan Party;

(d)           Debt in connection with any guarantees in favor of any protection and indemnity or War Risk associations to the extent such guarantees are required in connection with any insurance policies;

(e)           Charter Obligations of the Parent and its Subsidiaries in an aggregate amount not to exceed $50,000,000;

(f)            Debt of the Parent or any Subsidiary incurred to finance the acquisition, construction or improvement of any fixed or capital assets, and extensions, renewals and replacements of any such Debt that do not increase the outstanding principal amount thereof; provided that (i) such Debt is incurred prior to or within 90 days after such acquisition or the completion of such construction or improvement and (ii) the aggregate principal amount of Debt permitted by this paragraph shall not exceed $5,000,000 at any time outstanding;

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(g)           obligations (contingent or otherwise) of the Parent or any Subsidiary existing or arising under any Swap Contract, provided that (i) such obligations are (or were) entered into by such Person in the ordinary course of business for the purpose of directly mitigating risks associated with interest rates under this Agreement, foreign exchange liabilities or commodity expenses held or reasonably anticipated by such Person, and not for purposes of speculation or taking a “market view;” and (ii) interest rate Swap Contracts may not cover a notional amount greater than 50% of the aggregate outstanding Term Advances and for a term of not more than seven (7) years;

(h)           Debt in respect of Capital Leases and Synthetic Lease Obligations; provided, however, that the aggregate amount of all such Debt at any one time outstanding shall not exceed $5,000,000;

(i)            Guaranties in connection with Rig Construction Contracts or buyer indemnities per the Share Purchase Agreement;

(j)            Guaranty by the Parent of the obligations of Mandarin under Drillship Documents;

(k)           Drillship Debt; provided that after giving effect to such transaction on a pro forma basis, the Parent would have been in compliance with Sections 6.17 through 6.21 as of the end of the most recent fiscal quarter;

(l)            Guaranties by the Parent of obligations of any Bidding Entity in connection with the submission of a bid in an aggregate amount not to exceed $25,000,000;

(m)          Debt outstanding under one or more unsecured short term money market credit facilities the principal amount of which does not exceed $5,000,000 in the aggregate;

(n)           unsecured Debt incurred in the ordinary course of business in an aggregate principal amount not to exceed $3,000,000 at any time outstanding; and

(o)           unsecured Debt owing to Vantage Energy by Parent or OGIL in respect of the funds held in trust at Vantage Energy and used to pay the respective obligations of Parent to TMT and OGIL to Shipyard, in each case, on the Closing Date; provided that such Debt is paid in full within 90 days after the Closing Date.

Section 6.03           Merger or Consolidation.  Merge, dissolve, liquidate, consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person.

Section 6.04           Asset Sales.  Make any Asset Disposition or enter into any agreement to make any Asset Disposition, except for:

(a)           Sale of inventory in the ordinary course of business;

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(b)           The sale of obsolete, worn-our or surplus assets no longer used or usable in the business of the Borrowers or any of their Subsidiaries;

(c)           Asset Dispositions of equipment or real property if (i) such property is exchanged for credit against the purchase price of similar replacement property or against the purchase price of property purchased by a Loan Party for use in its business, or (ii) the proceeds of such Disposition are applied to the purchase price of replacement property or other property used by a Loan Party in its business;

(d)           Asset Dispositions of Property by any Subsidiary or a Borrower to a Borrower or any wholly-owned Subsidiary; provided that if the transferor of such property is a Loan Party, the transferee thereof must be a Loan Party;

(e)           the Borrowers may charter, lease or rent Rigs and other equipment in the ordinary course of business; provided that any such action taken with respect to a Rig is in accordance with the applicable provisions of  this Agreement; and

(f)            Asset Dispositions of any of the Drillship Documents from OGIL to a Drillship Entity.

Section 6.05           Investments.  Make or suffer to exist any Investments, or commitments therefor, except:

(a)           Investments in the form of Cash Equivalents;

(b)           Investments of the Parent in any of its Subsidiaries and Investments of any Loan Party in another Loan Party;

(c)           Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss;

(d)           Investments of foreign currencies or otherwise in time deposits or other securities of foreign Governmental Authorities or other foreign Persons, if required by the action of a foreign Governmental Authority or to fund working capital requirements for the operations of any Borrower in the foreign country;

(e)           Guarantees permitted by Section 6.02; and

(f)            other Investments not exceeding $5,000,000 in the aggregate in any fiscal year.

Section 6.06           Restricted Payments.  Declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except that:

(a)           each Subsidiary of the Parent (other than OGIL and its Subsidiaries) may make Restricted Payments to the Parent and to wholly-owned Subsidiaries (and, in the case of a Restricted Payment by a non-wholly-owned Subsidiary, to the Parent and any Subsidiary and to

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each other owner of Equity Interest or other equity interests of such Subsidiary on a pro rata basis based on their relative ownership interests);

(b)           the Parent and each Subsidiary may declare and make dividend payments or other distributions payable solely in the common stock or other common equity interests of such Person;

(c)           the Parent may purchase, redeem or otherwise acquire shares of its common stock or other common equity interests or warrants or options to acquire any such shares with the proceeds received from the substantially concurrent issue of new shares of its common stock or other common equity interests;

(d)           so long as no Event of Default exists and after giving effect to such transaction on a pro forma basis, no Default would be caused thereby, the Parent may make, or may cause OGIL and its Subsidiaries to make, Restricted Payments with the prior written consent of the Joint Bookrunners and the Super-Majority Lenders; and

(e)           so long as no Event of Default exists and after giving effect to such transaction on a pro forma basis, no Default would be caused thereby, the Parent may make, or may cause OGIL and its Subsidiaries to make, Restricted Payments with the proceeds from Top-Up Advances.

Section 6.07           Change in Nature of Business.  (a) With respect to the Loan Parties (other than the Borrowers), engage in any line of business substantially different from those lines of business conducted by the Parent and its Subsidiaries on the date hereof or any business substantially related or incidental thereto, (b) with respect to the Borrowers, (i) own any assets other than the Rigs and other assets directly related thereto, (ii) engage in any line of business other than the ownership and operation of the Rigs or (iii) establish any segregated portfolios and (c) with respect to Vantage Int’l Management (Singapore), Vantage Int’l Payroll (Singapore), and Vantage US Payroll, engage in any line of business substantially different from those lines of business conducted by such Person on the date hereof.

Section 6.08           Transactions With Affiliates.  Enter into any transaction of any kind with any Affiliate of the Parent, whether or not in the ordinary course of business, other than on fair and reasonable terms substantially as favorable to the Parent or such Subsidiary as would be obtainable by the Parent or such Subsidiary at the time in a comparable arm’s length transaction with a Person other than an Affiliate.

Section 6.09           Maintenance of Ownership of Subsidiaries.  Sell or otherwise dispose of any shares of Capital Stock of any Borrower, any Borrower will not sell or otherwise dispose of any shares of Capital Stock of any of its Subsidiaries, and none of the Borrowers nor any of their respective Subsidiaries shall issue, sell or otherwise dispose of (other than to the applicable Borrower or the Parent) any shares of its Capital Stock.

Section 6.10           Agreements Restricting Liens and Distributions.  Create or otherwise cause or suffer to exist any prohibition, encumbrance or restriction which prohibits or otherwise (a) restricts the ability (i) of any Subsidiary to make Restricted Payments to the Parent or any other Loan Party or to otherwise transfer property to the Parent or any other Loan Party, (ii) of

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any Subsidiary to Guarantee the Debt of the Loan Parties or (iii) of the Parent or any Subsidiary to create, incur, assume or suffer to exist Liens on property of such Person; provided, however, that this clause (iii) shall not prohibit any negative pledge incurred or provided in favor of any holder of Debt permitted under Section 6.02(f) or Section 6.02(l) solely to the extent any such negative pledge relates to the Property financed by or the subject of such Debt; or (b) requires the grant of a Lien to secure an obligation of such Person if a Lien is granted to secure another obligation of such Person.

Section 6.11           Limitation on Accounting Changes or Changes in Fiscal Periods.  Permit (a) any change in any of its accounting policies affecting the presentation of financial statements or reporting practices, except as required or permitted by GAAP or (b) the fiscal year of the Parent or any of its Subsidiaries to end on a day other than December 31 or change the Parent’s method of determining fiscal quarters.

Section 6.12           Sale and Leaseback Transactions and other Off-Balance Sheet Liabilities.  Enter into or suffer to exist any (a) Sale and Leaseback Transaction or (b) any other transaction pursuant to which it incurs or has incurred Off-Balance Sheet Liabilities, except for obligations permitted to be incurred under the terms of Section 6.02.

Section 6.13           Amendment of Material Contracts.  Amend, modify, supplement,  terminate or waive any provision of (a) the Loan Parties’ organizational documents in a manner which would be materially adverse to the Secured Parties or (b) the Transaction Documents.

Section 6.14           Operation of Rigs.

(a)           make any modification to any Rig which would materially or adversely alter the structure, type or performance characteristics of such Rig or which would materially reduce the value of such Rig;

(b)           employ any Rig or allow its employment in any trade or business which is unlawful under the laws of any relevant jurisdiction in which it is located or subject or in carrying illicit or prohibited goods or in any manner whatsoever which can reasonably be expected to render it liable to destruction, seizure or confiscation; and in the event of hostilities in any part of the world (whether war be declared or not) not employ any Rig or suffer its employment in carrying any contraband goods or to enter or trade to any zone which is declared a war zone by any Government Authority or by the War Risks insurers of such Rig unless there shall have been effected by the Loan Parties (at their expense) such special, additional or modified insurance cover as the Collateral Agent may reasonably require;

(c)           if an Event of Default has occurred and is continuing, undertake or commence upgrades or improvements on any Rig without the previous consent of the Majority Lenders, and unless the Person to provide such upgrades or improvements shall first have given to the Collateral Agent a written waiver or subordination of its Liens or its equivalent, such waiver or subordination to be in form and substance reasonably satisfactory to the Collateral Agent;

(d)           charter any Rig to, or permit the Rig to serve under any contract with, a Person (i) or engage in any transaction, which will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR,

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Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto, or (ii) described or designated in the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism Order or (iii) that engages or will engage in any dealings or transactions, or is or will be otherwise associated, with any such Person, if such transaction or violation would (A) expose the Collateral Agent or any Secured Party to any penalty, sanction or investigation or (B) jeopardize the Lien created by the Rig Mortgages or (C) reasonably be expected to have a material adverse effect on the Loan Parties or the operation of the Rigs, or any Loan Party’s ability to load or discharge cargo or to effect repairs on the Rigs;

(e)           cause or permit any Rig to be operated in any manner contrary to law (except where the failure to operate in compliance with any law would not have a material adverse effect on the Loan Parties, such Rig or the Lien created by the applicable Rig Mortgage);

(f)            abandon any Rig in a port outside the United States of America;

(g)           engage in any unlawful trade or violate any law or carry any cargo that shall expose any Rig to forfeiture or capture;

(h)           operate any Rig in any jurisdiction or in any manner which could cause the Lien created by the applicable Rig Mortgage to be rendered unenforceable or the Collateral Agent’s foreclosure or enforcement rights to be materially impaired or hindered; or

(i)            without giving prior written notice thereof to the Collateral Agent, change the registered owner, name, flag, official or patent number, as the case may be, the home port or class of any Rig.

Section 6.15           Bank Accounts.  Establish any bank accounts other than (a) the Earnings Account, the Retention Account and the Debt Service Reserve Account, or (b) accounts to be maintained with a Lender or if not maintained with a Lender, (i) to be subject to an Account Control Agreement, (ii) to contain less than $200,000 individually or $600,000 in the aggregate at any time, or (iii) to be payroll accounts.  Schedule 6.15 sets forth the account numbers and locations of all bank accounts of the Loan Parties as of the Closing Date.

Section 6.16           Capital Expenditures.  Expend, or be committed to expend, in excess of (a) $12,000,000 in the aggregate of Additional Costs during the term of this Agreement for the initial outfitting of the Rigs and (b) $10,000,000 of Capital Expenditures (net of reimbursements by customers, reimbursement obligations of customers, or proceeds of Asset Dispositions used to make such Capital Expenditures and excluding any Capital Expenditures financed by capital contributions made by the Parent) during any one fiscal year on a non-cumulative basis with respect to any Rig.

Section 6.17           Leverage Ratio.

(a)           Permit the Leverage Ratio for the Parent and its Subsidiaries on a consolidated basis at all times beginning with the first day of the third fiscal quarter occurring after the Rig 4 Delivery Date to be greater than 4.50 to 1.00.

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(b)           Permit the Leverage Ratio for OGIL and its Subsidiaries on a consolidated basis at all times beginning with the first day of the third fiscal quarter occurring after the Rig 4 Delivery Date to be greater than 4.50 to 1.00.

Section 6.18           Net Debt to Capitalization Ratio.

(a)           Permit the ratio of (a) Consolidated Net Debt for the Parent and its Subsidiaries on a consolidated basis to (b) Equity of the Parent, each at all times, to be greater than 2.00 to 1.00.

(b)           Permit the ratio of (a) Consolidated Net Debt for OGIL and its Subsidiaries on a consolidated basis to (b) Equity of OGIL, each at all times, to be greater than 2.00 to 1.00.

Section 6.19           Free Cash Balances.

(a)           Permit Free Cash Balances of the Parent and its Subsidiaries on a consolidated basis to be less than $5,000,000.

(b)           Permit Free Cash Balances of OGIL and its Subsidiaries on a consolidated basis to be less than $5,000,000.

Section 6.20           Working Capital Ratio.

(a)           Permit the Working Capital Ratio for the Parent and its Subsidiaries on a consolidated basis at all times to be less than 1.00 to 1.00.

(b)           Permit the Working Capital Ratio for OGIL and its Subsidiaries on a consolidated basis at all times to be less than 1.00 to 1.00.

Section 6.21           Fixed Charge Coverage Ratio.

(a)           Permit the Fixed Charge Coverage Ratio for the Parent and its Subsidiaries on a consolidated basis at all times beginning with the first day of the third fiscal quarter occurring after the Rig 4 Delivery Date to be less than 1.25 to 1.00.

(b)           Permit the Fixed Charge Coverage Ratio for OGIL and its Subsidiaries on a consolidated basis at all times beginning with the first day of the third fiscal quarter occurring after the Rig 4 Delivery Date to be less than 1.25 to 1.00.

ARTICLE VII
EVENTS OF DEFAULT

Section 7.01           Events of Default.  The occurrence of any of the following events shall constitute an “Event of Default” under any Loan Document:

(a)           Payment.  Any Borrower shall fail to pay (i) any principal of any Advance (including, without limitation, any mandatory prepayment required by Section 2.07) or reimburse

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any drawing under any Letter of Credit when the same becomes due and payable, or (ii) any interest on the Advances, any fees, reimbursements, indemnifications, or other amounts payable in connection with the Obligations, this Agreement or under any other Loan Document within three Business Days after the same becomes due and payable;

(b)           Representation and Warranties.  Any representation or statement made or deemed to be made by any Borrower or any other Loan Party (or any of their respective officers) in this Agreement, in any other Loan Document, or in connection with this Agreement or any other Loan Document shall prove to have been incorrect in any material respect when made or deemed to be made;

(c)           Covenant Breaches.  Any Borrower or any other Loan Party shall (i) fail to perform or observe any covenant contained in Sections 2.07, 5.01, 5.04, 5.06, 5.07, 5.09, 5.12, 5.14, and 5.15 and Article VI of this Agreement or (ii) fail to perform or observe any other term or covenant set forth in this Agreement or in any other Loan Document which is not covered by clause (i) above or any other provision of this Section 7.01 if such failure shall remain unremedied for 30 days after the earlier of (A) written notice of such default shall have been given to the Borrowers by the Facility Agent or any Lender or (B) any actual knowledge of such default by a Responsible Officer of any Loan Party;

(d)           Cross-Default.  (i) Any Loan Party or any of its Subsidiaries shall fail to pay any principal of or premium or interest on its Debt which is outstanding in a principal amount of at least $5,000,000 (or the equivalent in any other currency) individually or when aggregated with all such Debt of the Person so in default (but excluding Debt evidenced by the Advances) when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), (ii) any other event shall occur or condition shall exist under any agreement or instrument relating to Debt which is outstanding in a principal amount of at least $5,000,000 (or the equivalent in any other currency) individually or when aggregated with all such Debt of the Person so in default (but excluding Debt evidenced by the Advances), if the effect of such event or condition is to accelerate, or to permit the acceleration of, the maturity of such Debt; (iii) any such Debt shall be declared to be due and payable, or required to be prepaid (other than by a regularly scheduled required prepayment), prior to the stated maturity thereof; or (iv) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default under such Swap Contract as to which a Loan Party or any Subsidiary thereof is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which a Loan Party or any Subsidiary thereof is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by such Loan Party or such Subsidiary as a result thereof is greater than $5,000,000;

(e)           Insolvency.  Any Loan Party or any of its Subsidiaries shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, commences negotiations with one or more of its creditors with a view to rescheduling any of its indebtedness which it would not otherwise be able to pay as it falls due or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against any Loan Party or any of its Subsidiaries seeking to adjudicate it as a bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, or

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composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver, trustee or other similar official for it or for any substantial part of its property and, in the case of any such proceeding instituted against such Person, either such proceeding shall remain undismissed for a period of 60 days or any of the actions sought in such proceeding shall occur; or such Person shall take any action to authorize any of the actions set forth above in this paragraph (e) or any analogous procedure or step is taken in any jurisdiction;

(f)            Judgments.  Any judgment, decree or order for the payment of money shall be rendered against any Loan Party or any of its Subsidiaries in an amount in excess of $10,000,000 (or the equivalent in any other currency) and either (i) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (ii) there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect;

(g)           ERISA.  (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably be expected to result in liability of any Loan Party under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold Amount, or (ii) the Parent or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of $5,000,000;

(h)           Loan Documents.  Any Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect and if such failure can be cured by the Loan Parties, the Loan Parties refuse to take actions required by Facility Agent to cure such unenforceability; or any Loan Party or any other Person contests in any manner the validity or enforceability of any Loan Document; or any Loan Party denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document;

(i)            Security Documents.  The Collateral Agent for the benefit of the Secured Parties shall fail to have an Acceptable Security Interest in a material portion of the Collateral, except to the extent otherwise permitted by this Agreement and if such failure can be cured by the Loan Parties, the Loan Parties refuse to take actions required by Facility Agent to cure such failure;

(j)            Material Contracts.  There shall have been (i) an amendment, material default, extension of the Delivery Date under, termination or cancellation of any Transaction Document (other than any amendment or extension approved by the Joint Bookrunners in consultation with the Majority Lenders) or (ii) a material default under, termination or cancellation of any Drillship Document; or

(k)           Change in Control.  A Change of Control shall occur.

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Section 7.02           Optional Acceleration of Maturity.  If any Event of Default (other than an Event of Default pursuant to Section 7.01(e)) shall have occurred and be continuing, then, and in any such event:

(a)           the Facility Agent (i) shall at the written request, or may with the consent, of the Majority Lenders, by notice to the Borrowers, declare the Commitments and the obligation of each Lender and each Issuing Bank to make extensions of credit hereunder, including making Advances and issuing Letters of Credit, to be terminated, whereupon the same shall forthwith terminate, and (ii) shall at the written request, or may with the consent, of the Majority Lenders, by notice to the Borrowers, declare all principal, interest, fees, reimbursements, indemnifications, and all other amounts payable under this Agreement and the other Loan Documents to be forthwith due and payable, whereupon all such amounts shall become and be forthwith due and payable in full, without notice of intent to demand, demand, presentment for payment, notice of nonpayment, protest, notice of protest, grace, notice of dishonor, notice of intent to accelerate, notice of acceleration, and all other notices, all of which are hereby expressly waived by the Borrowers;

(b)           each Borrower shall, on demand of the Facility Agent at the written request or with the consent of the Majority Lenders, deposit with the Facility Agent into the LC Cash Collateral Account an amount of cash in Dollars equal to the outstanding Letter of Credit Exposure as security for the Obligations to the extent the Letter of Credit Obligations are not otherwise paid at such time; and

(c)           the Collateral Agent shall at the written request of, or may with the consent of, the Majority Lenders proceed to enforce its rights and remedies under the Security Documents, this Agreement, and any other Loan Document for the ratable benefit of the Lenders by appropriate proceedings.

Section 7.03           Automatic Acceleration of Maturity.  If any Event of Default pursuant to paragraph (e) of Section 7.01 shall occur:

(a)           (i) the Commitments and the obligation of each Lender and each Issuing Bank to make extensions of credit hereunder, including making Advances and issuing Letters of Credit, shall terminate, and (ii) all principal, interest, fees, reimbursements, indemnifications, and all other amounts payable under this Agreement and the other Loan Documents shall become and be forthwith due and payable in full, without notice of intent to demand, demand, presentment for payment, notice of nonpayment, protest, notice of protest, grace, notice of dishonor, notice of intent to accelerate, notice of acceleration, and all other notices, all of which are hereby expressly waived by the Borrowers;

(b)           each Borrower shall deposit with the Facility Agent into the LC Cash Collateral Account an amount of cash in Dollars equal to the outstanding Letter of Credit Exposure as security for the Obligations to the extent the Letter of Credit Obligations are not otherwise paid at such time; and

(c)           the Collateral Agent shall at the written request of, or may with the consent of, the Majority Lenders proceed to enforce its rights and remedies under the Security Documents, this

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Agreement, and any other Loan Document for the ratable benefit of the Lenders by appropriate proceedings.

Section 7.04           Non-exclusivity of Remedies.  No remedy conferred upon the Facility Agent, the Collateral Agent, the Issuing Banks and the Lenders is intended to be exclusive of any other remedy, and each remedy shall be cumulative of all other remedies existing by contract, at law, in equity, by statute or otherwise.

Section 7.05           Right of Set-off.  If an Event of Default shall have occurred and be continuing, each Lender, each Issuing Bank, and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, such Issuing Bank or any such Affiliate to or for the credit or the account of any Borrower or any other Loan Party against any and all of the obligations of the Borrowers or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or such Issuing Bank, irrespective of whether or not such Lender or such Issuing Bank shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrowers or such Loan Party may be contingent or unmatured or are owed to a branch or office of such Lender or Issuing Bank different from the branch or office holding such deposit or obligated on such indebtedness. The rights of each Lender, each Issuing Bank and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, such Issuing Bank or their respective Affiliates may have. Each Lender and each Issuing Bank agrees to notify the Borrowers and the Facility Agent promptly after any such setoff and application, provided that the failure to give such notice shall not affect the validity of such setoff and application.

Section 7.06           Application of Proceeds.

(a)           So long as no Event of Default has occurred and is continuing, on each Payment Date until the applicable Tranche of Advances have been repaid in full, after payment of Permitted Operating Expenses from monies in each of the Earnings Account, funds in the applicable Retention Account and the applicable Earning Account will be applied in the following priority:

(i)            First, to the ratable payment of any fees and other unreimbursed reasonable expenses for which any Mandated Lead Arranger, any Joint Bookrunner, any Agent or any Secured Party is to be reimbursed pursuant to this Agreement or any other Loan Document, in each case that are then due and payable;

(ii)           Second, to the payment of all obligations of the Loan Parties owing to any Swap Counterparty under any Swap Contract, including, if applicable, the Swap Termination Value, if any, then due and payable;

(iii)          Third, to the ratable payment of accrued but unpaid interest on the applicable Tranche of Advances then due and payable under this Agreement;

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(iv)          Fourth, to the ratable payment of all principal of the Obligations then due and payable which relate to the applicable Tranche of Advances and Letters of Credit and which are owing to the Facility Agent, the Collateral Agent, the Issuing Banks and the Lenders;

(v)           Fifth, to fund the Debt Service Reserve Account such that the aggregate amount of deposits in the Debt Service Reserve Account are at least equal to three months of Debt Service of the applicable Tranche of Advances;

(vi)          Sixth, to the payment of any prepayment premiums then due and payable with respect to such applicable Tranche of Advances pursuant to Section 2.07(c)(vi);

(vii)         Seventh, to the ratable payment of any other unreimbursed indemnities for which any Mandated Lead Arranger, any Joint Bookrunner, any Agent or any Secured Party is to be indemnified pursuant to this Agreement or any other Loan Document, in each case that are then due and payable;

(viii)        Eighth, to the payment of any Permitted Capital Expenditures;

(ix)           Ninth, 50% of the remaining balance (the “Excess Cash Flow”) shall be applied as a mandatory prepayment in accordance with Section 2.07(c)(i);

(x)            Tenth, to the ratable repayment of the applicable Tranche of all outstanding Revolving Advances; and

(xi)           Eleventh, any excess shall be remitted to the Earnings Account.

(b)           From and during the continuance of any Event of Default, any monies or property actually received by the Facility Agent or the Collateral Agent pursuant to this Agreement or any other Loan Document, the exercise of any rights or remedies under any Security Document or any other agreement with any Borrower, any Guarantor or any of their Subsidiaries which secures any of the Obligations, shall be applied in the following order:

(i)            First, to payment of the reasonable expenses, liabilities, losses, costs, duties, fees, charges or other moneys whatsoever (together with interest payable thereon) as may have been paid or incurred in, about or incidental to any sale or other realization of Collateral, including reasonable compensation to the Collateral Agent and its agents and counsel, and to the ratable payment of any other unreimbursed reasonable expenses and indemnities for which any Mandated Lead Arranger, any Joint Bookrunner, any Agent or any Secured Party is to be reimbursed pursuant to this Agreement or any other Loan Document, in each case that are then due and payable;

(ii)           Second, to the ratable payment of accrued but unpaid fees of the Facility Agent, commitment fees, letter of credit fees, and fronting fees owing to the Facility Agent, the Issuing Banks, and the Lenders in respect of the Advances and Letters of Credit under this Agreement;

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(iii)          Third, to the ratable payment of accrued but unpaid interest on the Advances and any Obligations owing to any Swap Counterparty under any Swap Contract, including, without limitation, Swap Termination Value, then due and payable under this Agreement on a pari passu basis;

(iv)          Fourth, ratably, according to the then unpaid amounts thereof, without preference or priority of any kind among them, to the ratable payment of all other Obligations then due and payable which relate to Advances and Letters of Credit and which are owing to the Facility Agent, the Collateral Agent, the Issuing Banks and the Lenders and to the payment of all obligations of the Loan Parties owing to any Swap Counterparty under any Swap Contract, including, without limitation, Swap Termination Value, if any, then due and payable on a pari passu basis;

(v)           Fifth, to the ratable payment of all outstanding Obligations then due and payable; and

(vi)          Sixth, any excess after payment in full of all Obligations shall be paid to any Borrower or any Loan Party as appropriate or to such other Person who may be lawfully entitled to receive such excess.

ARTICLE VIII
THE GUARANTY

Section 8.01           Liabilities Guaranteed.  Each Guarantor hereby, joint and severally, irrevocably and unconditionally guarantees the prompt payment at maturity of the Obligations.

Section 8.02           Nature of Guaranty.  This guaranty is an absolute, irrevocable, completed and continuing guaranty of payment and not a guaranty of collection, and no notice of the Obligations or any extension of credit already or hereafter contracted by or extended to any Borrower need be given to any Guarantor. This guaranty may not be revoked by any Guarantor and shall continue to be effective with respect to the Obligations arising or created after any attempted revocation by such Guarantor and shall remain in full force and effect until the Obligations are paid in full and the Commitments are terminated, notwithstanding that from time to time prior thereto no Obligations may be outstanding. The Borrowers and the Lenders may modify, alter, rearrange, extend for any period and/or renew from time to time, the Obligations, and the Lenders may waive any Default or Events of Default without notice to any Guarantor and in such event each Guarantor will remain fully bound hereunder on the Obligations. This guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of the Obligations is rescinded or must otherwise be returned by any of the Lenders upon the insolvency, bankruptcy or reorganization of any Borrower or otherwise, all as though such payment had not been made. This guaranty may be enforced by the Facility Agent and any subsequent holder of any of the Obligations and shall not be discharged by the assignment or negotiation of all or part of the Obligations. Each Guarantor hereby expressly waives presentment, demand, notice of non-payment, protest and notice of protest and dishonor, notice of Default or Event of Default, and also notice of acceptance of this guaranty, acceptance on the

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part of the Lenders being conclusively presumed by the Lenders’ request for this guaranty and the Guarantors’ being party to this Agreement.

Section 8.03           Agent’s Rights.  Each Guarantor authorizes the Facility Agent, without notice or demand and without affecting any Guarantor’s liability hereunder, to take and hold security for the payment of its obligations under this Article VIII and/or the Obligations, and exchange, enforce, waive and release any such security; and to apply such security and direct the order or manner of sale thereof as the Facility Agent in its discretion may determine, and to obtain a guaranty of the Obligations from any one or more Persons and at any time or times to enforce, waive, rearrange, modify, limit or release any of such other Persons from their obligations under such guaranties.

Section 8.04           Guarantor’s Waivers.

(a)           General.  Each Guarantor waives any right to require any of the Lenders to (i) proceed against any Borrower or any other person liable on the Obligations, (ii) enforce any of their rights against any other guarantor of the Obligations, (iii) proceed or enforce any of their rights against or exhaust any security given to secure the Obligations, (iv) have any Borrower joined with any Guarantor in any suit arising out of this Article VIII and/or the Obligations, or (v) pursue any other remedy in the Lenders’ powers whatsoever. The Lenders shall not be required to mitigate damages or take any action to reduce, collect or enforce the Obligations. Guarantor waives any defense arising by reason of any disability, lack of corporate authority or power, or other defense of any Borrower or any other guarantor of the Obligations, and shall remain liable hereon regardless of whether any Borrower or any other guarantor be found not liable thereon for any reason. Whether and when to exercise any of the remedies of the Lenders under any of the Loan Documents shall be in the sole and absolute discretion of the Facility Agent, acting upon the written request or with the consent of the Majority Lenders, and no delay by the Facility Agent in enforcing any remedy, including delay in conducting a foreclosure sale, shall be a defense to any Guarantor’s liability under this Article VIII.

(b)           In addition to the waivers contained in Section 8.04(a) hereof, the Guarantors waive, and agree that they shall not at any time insist upon, plead or in any manner whatsoever claim or take the benefit or advantage of, any appraisal, valuation, stay, extension, marshaling of assets or redemption laws, or exemption, whether now or at any time hereafter in force, which may delay, prevent or otherwise affect the performance by the Guarantors of their obligations under, or the enforcement by the Facility Agent or the Lenders of, this Guaranty.  The Guarantors hereby waive diligence, presentment and demand (whether for nonpayment or protest or of acceptance, maturity, extension of time, change in nature or form of the Obligations, acceptance of further security, release of further security, composition or agreement arrived at as to the amount of, or the terms of, the Obligations, notice of adverse change in any Borrower’s financial condition or any other fact which might materially increase the risk to the Guarantors) with respect to any of the Obligations or all other demands whatsoever and waive the benefit of all provisions of law which are or might be in conflict with the terms of this Article VIII.  The Guarantors, jointly and severally, represent, warrant and agree that, as of the date of this Guaranty, their obligations under this Guaranty are not subject to any offsets or defenses of any kind against the Administrative Agent, the Lenders, any Borrower or any other Person that executes a Loan Document.  The Guarantors further jointly and severally agree that their

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obligations under this Guaranty shall not be subject to any counterclaims, offsets or defenses of any kind which may arise in the future against the Administrative Agent, the Lenders, the Borrowers or any other Person that executes a Loan Document.

(c)           Subrogation.  Until the Obligations have been paid in full, each Guarantor waives all rights of subrogation or reimbursement against any Borrower, whether arising by contract or operation of law (including, without limitation, any such right arising under any federal or state bankruptcy or insolvency laws) and waives any right to enforce any remedy which the Lenders now have or may hereafter have against any Borrower, and waives any benefit or any right to participate in any security now or hereafter held by the Facility Agent or any Lender.

Section 8.05           Maturity of Obligations, Payment.  Each Guarantor agrees that if the maturity of any of the Obligations is accelerated by bankruptcy or otherwise, such maturity shall also be deemed accelerated for the purpose of this Article VIII without demand or notice to any Guarantor. Each Guarantor will, forthwith upon notice from the Facility Agent, jointly and severally pay to the Facility Agent the amount due and unpaid by any Borrower and guaranteed hereby. The failure of the Facility Agent to give this notice shall not in any way release any Guarantor hereunder.

Section 8.06           Agent’s Expenses.  If any Guarantor fails to pay the Obligations after notice from the Facility Agent of any Borrower’s failure to pay any Obligations at maturity, and if any Agent obtains the services of an attorney for collection of amounts owing by any Guarantor hereunder, or obtaining advice of counsel in respect of any of their rights under this Article VIII, or if suit is filed to enforce this Article VIII, or if proceedings are had in any bankruptcy, probate, receivership or other judicial proceedings for the establishment or collection of any amount owing by any Guarantor hereunder, or if any amount owing by any Guarantor hereunder is collected through such proceedings, each Guarantor jointly and severally agrees to pay to such Agent such Agent’s reasonable attorneys’ fees.

Section 8.07           Liability.  It is expressly agreed that the liability of each Guarantor for the payment of the Obligations guaranteed hereby shall be primary and not secondary.

Section 8.08           Events and Circumstances Not Reducing or Discharging any Guarantor’s Obligations.  Each Guarantor hereby consents and agrees to each of the following to the fullest extent permitted by law, and agrees that each Guarantor’s obligations under this Article VIII shall not be released, diminished, impaired, reduced or adversely affected by any of the following, and waives any rights (including without limitation rights to notice) which each Guarantor might otherwise have as a result of or in connection with any of the following:

(a)           Modifications, etc.  Any renewal, extension, modification, increase, decrease, alteration or rearrangement of all or any part of the Obligations, or this Agreement or any instrument executed in connection therewith, or any contract or understanding between any Borrower and any of the Lenders, or any other Person, pertaining to the Obligations;

(b)           Adjustment, etc.  Any adjustment, indulgence, forbearance or compromise that might be granted or given by any of the Lenders to any Borrower or any Guarantor or any Person liable on the Obligations;

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(c)           Condition of any Borrower or any Guarantor.  The insolvency, bankruptcy arrangement, adjustment, composition, liquidation, disability, dissolution, death or lack of power of any Borrower or any Guarantor or any other Person at any time liable for the payment of all or part of the Obligations; or any dissolution of any Borrower or any Guarantor, or any sale, lease or transfer of any or all of the assets of any Borrower or any Guarantor, or any changes in the shareholders, partners, or members of any Borrower or any Guarantor; or any reorganization of any Borrower or any Guarantor;

(d)           Invalidity of Obligations.  The invalidity, illegality or unenforceability of all or any part of the Obligations, or any document or agreement executed in connection with the Obligations, for any reason whatsoever, including without limitation the fact that the Obligations, or any part thereof, exceed the amount permitted by law, the act of creating the Obligations or any part thereof is ultra vires, the officers or representatives executing the documents or otherwise creating the Obligations acted in excess of their authority, the Obligations violate applicable usury laws, any Borrower has valid defenses, claims or offsets (whether at law, in equity or by agreement) which render the Obligations wholly or partially uncollectible from any Borrower, the creation, performance or repayment of the Obligations (or the execution, delivery and performance of any document or instrument representing part of the Obligations or executed in connection with the Obligations, or given to secure the repayment of the Obligations) is illegal, uncollectible, legally impossible or unenforceable, or this Agreement or other documents or instruments pertaining to the Obligations have been forged or otherwise are irregular or not genuine or authentic;

(e)           Release of Obligors.  Any full or partial release of the liability of any Borrower on the Obligations or any part thereof, of any co-guarantors, or any other Person now or hereafter liable, whether directly or indirectly, jointly, severally, or jointly and severally, to pay, perform, guarantee or assure the payment of the Obligations or any part thereof, it being recognized, acknowledged and agreed by any Guarantor that such Guarantor may be required to pay the Obligations in full without assistance or support of any other Person, and no Guarantor has been induced to enter into this Article VIII on the basis of a contemplation, belief, understanding or agreement that other parties other than any Borrower will be liable to perform the Obligations, or the Lenders will look to other parties to perform the Obligations;

(f)            Other Security.  The taking or accepting of any other security, collateral or guaranty, or other assurance of payment, for all or any part of the Obligations;

(g)           Release of Collateral etc. Any release, surrender, exchange, subordination, deterioration, waste, loss or impairment (including without limitation negligent, willful, unreasonable or unjustifiable impairment) of any collateral, property or security, at any time existing in connection with, or assuring or securing payment of, all or any part of the Obligations;

(h)           Care and Diligence.  The failure of the Lenders or any other Person to exercise diligence or reasonable care in the preservation, protection, enforcement, sale or other handling or treatment of all or any part of such collateral, property or security;

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(i)            Status of Liens.  The fact that any collateral, security, security interest or lien contemplated or intended to be given, created or granted as security for the repayment of the Obligations shall not be properly perfected or created, or shall prove to be unenforceable or subordinate to any other security interest or lien, it being recognized and agreed by each Guarantor that no Guarantor is entering into this Article VIII in reliance on, or in contemplation of the benefits of, the validity, enforceability, collectibility or value of any of the collateral for the Obligations;

(j)            Payments Rescinded.  Any payment by any Borrower to the Lenders is held to constitute a preference under the bankruptcy laws, or for any reason the Lenders are required to refund such payment or pay such amount to any Borrower or someone else; or

(k)           Other Actions Taken or Omitted.  Any other action taken or omitted to be taken with respect to this Agreement, the Obligations, or the security and collateral therefor, whether or not such action or omission prejudices any Guarantor or increases the likelihood that any Guarantor will be required to pay the Obligations pursuant to the terms hereof, it being the unambiguous and unequivocal intention of each Guarantor that each Guarantor shall be obligated to joint and severally pay the Obligations when due, notwithstanding any occurrence, circumstance, event, action, or omission whatsoever, whether contemplated or uncontemplated, and whether or not otherwise or particularly described herein, except for the full and final payment and satisfaction of the Obligations.

Section 8.09           Subordination of All Guarantor Claims.

(a)           As used herein, the term “Guarantor Claims” shall mean all debts and liabilities of any Borrower or any Subsidiary of any Borrower to any Guarantor, whether such debts and liabilities now exist or are hereafter incurred or arise, or whether the obligation of such Borrower or such Subsidiary thereon be direct, contingent, primary, secondary, several, joint and several, or otherwise, and irrespective of whether such debts or liabilities be evidenced by note, contract, open account, or otherwise, and irrespective of the person or persons in whose favor such debts or liabilities may, at their inception, have been, or may hereafter be created, or the manner in which they have been or may hereafter be acquired by any Guarantor. The Guarantor Claims shall include without limitation all rights and claims of any Guarantor against any Borrower or any Subsidiary of such Borrower arising as a result of subrogation or otherwise as a result of such Guarantor’s payment of all or a portion of the Obligations. Until the Obligations shall be paid and satisfied in full and each Guarantor shall have performed all of its obligations hereunder, no Guarantor shall receive or collect, directly or indirectly, from any Borrower or any Subsidiary of such Borrower or any other party any amount upon the Guarantor Claims.

(b)           Each Borrower and each Guarantor hereby (i) authorizes the Facility Agent and the Lenders to demand specific performance of the terms of this Section 8.09, whether or not any Borrower or any Guarantor shall have complied with any of the provisions hereof applicable to it, at any time when it shall have failed to comply with any provisions of this Section 8.09 which are applicable to it and (ii) irrevocably waives any defense based on the adequacy of a remedy at law, which might be asserted as a bar to such remedy of specific performance.

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(c)           Upon any distribution of assets of any Loan Party in any dissolution, winding up, liquidation or reorganization (whether in bankruptcy, insolvency or receivership proceedings or upon an assignment for the benefit of creditors or otherwise):

(i)            The Lenders shall first be entitled to receive payment in full in cash of the Obligations before any Borrower or any Guarantor is entitled to receive any payment on account of the Guarantor Claims.

(ii)           Any payment or distribution of assets of any Loan Party of any kind or character, whether in cash, property or securities, to which the Borrower or any Guarantor would be entitled except for the provisions of this Section 8.09(c), shall be paid by the liquidating trustee or agent or other Person making such payment or distribution directly to the Lenders, to the extent necessary to make payment in full of all Obligations remaining unpaid after giving effect to any concurrent payment or distribution or provisions therefor to the Lenders.

(d)           No right of the Lenders or any other present or future holders of any Obligations to enforce the subordination provisions herein shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of any Loan Party or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by any Borrower or any Guarantor with the terms hereof, regardless of any knowledge thereof which any such holder may have or be otherwise charged with.

Section 8.10           Claims in Bankruptcy.  In the event of receivership, bankruptcy, reorganization, arrangement, debtor’s relief, or other insolvency proceedings involving any Borrower or any Subsidiary thereof, as debtor, the Lenders shall have the right to prove their claim in any proceeding, so as to establish their rights hereunder and receive directly from the receiver, trustee or other court custodian, dividends and payments which would otherwise be payable upon Guarantor Claims.  Each Guarantor hereby assigns such dividends and payments to the Lenders. Should the Facility Agent or any Lender receive, for application upon the Obligations, any such dividend or payment which is otherwise payable to any Guarantor, and which, as between any Borrower or any Subsidiary thereof and any Guarantor, shall constitute a credit upon the Guarantor Claims, then upon payment in full of the Obligations, such Guarantor shall become subrogated to the rights of the Lenders to the extent that such payments to the Lenders on the Guarantor Claims have contributed toward the liquidation of the Obligations, and such subrogation shall be with respect to that proportion of the Obligations which would have been unpaid if the Facility Agent or a Lender had not received dividends or payments upon the Guarantor Claims.

Section 8.11           Payments Held in Trust.  In the event that notwithstanding Sections 8.09 and 8.10 above, any Guarantor should receive any funds, payments, claims or distributions which is prohibited by such Sections, such Guarantor agrees to hold in trust for the Lenders an amount equal to the amount of all funds, payments, claims or distributions so received, and agrees that it shall have absolutely no dominion over the amount of such funds, payments, claims or distributions except to pay them promptly to the Facility Agent, and each Guarantor covenants promptly to pay the same to the Facility Agent.

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Section 8.12           Benefit of Guaranty.  The provisions of this Article VIII are for the benefit of the Secured Parties, their successors, and their permitted transferees, endorsees and assigns.  In the event all or any part of the Obligations are transferred, endorsed or assigned by the Lenders, as the case may be, to any Person or Persons in accordance with the terms of this Agreement, any reference to the “Lenders” herein, as the case may be, shall be deemed to refer equally to such Person or Persons.

Section 8.13           Reinstatement.  This Article VIII shall remain in full force and effect and continue to be effective in the event any petition is filed by or against any Borrower, any Guarantor or any other Loan Party for liquidation or reorganization, in the event that any of them becomes insolvent or makes an assignment for the benefit of creditors or in the event a receiver, trustee or similar Person is appointed for all or any significant part of any of their assets, and shall continue to be effective or be reinstated, as the case may be, if at any time payment and performance of the Obligations, or any part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by the Lenders, whether as a “voidable preference,” “fraudulent conveyance,” or otherwise, all as though such payment or performance had not been made.  In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Obligations shall be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned.

Section 8.14           Liens Subordinate.  Each Guarantor agrees that any liens, security interests, judgment liens, charges or other encumbrances upon any Borrower’s or any of its Subsidiary’s assets securing payment of the Guarantor Claims shall be and remain inferior and subordinate to any liens, security interests, judgment liens, charges or other encumbrances upon any Borrower’s or any Subsidiary of such Borrower’s assets securing payment of the Obligations, regardless of whether such encumbrances in favor of any Guarantor, the Facility Agent or the Lenders presently exist or are hereafter created or attach.

Section 8.15           Guarantor’s Enforcement Rights.  Without the prior written consent of the Lenders, no Guarantor shall (a) exercise or enforce any creditor’s right it may have against any Borrower or any Subsidiary of such Borrower, or (b) foreclose, repossess, sequester or otherwise take steps or institute any action or proceeding (judicial or otherwise, including without limitation the commencement of or joinder in any liquidation, bankruptcy, rearrangement, debtor’s relief or insolvency proceeding) to enforce any lien, mortgages, deeds of trust, security interest, collateral rights, judgments or other encumbrances on assets of any Borrower or any Subsidiary of such Borrower held by Guarantor.

Section 8.16           Limitation.  It is the intention of the Guarantors and each Secured Party that the amount of the Obligations guaranteed by each Guarantor shall be in, but not in excess of, the maximum amount permitted by fraudulent conveyance, fraudulent transfer and similar Legal Requirement applicable to such Guarantor. Accordingly, notwithstanding anything to the contrary contained in this Article VIII or in any other agreement or instrument executed in connection with the payment of any of the Obligations guaranteed hereby, the amount of the Obligations guaranteed by a Guarantor under this Article VIII shall be limited to an aggregate amount equal to the largest amount that would not render such Guarantor’s obligations hereunder subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provision of any other applicable law.

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Section 8.17           Contribution Rights.

(a)           To the extent that any payment is made under this Guaranty (a “Guarantor Payment”), by a Guarantor, which Guarantor Payment, taking into account all other Guarantor Payments then previously or concurrently made by all other Guarantors, exceeds the amount which such Guarantor would otherwise have paid if each Guarantor had paid the aggregate Obligations satisfied by such Guarantor Payment in the same proportion that such Guarantor’s Allocable Amount (as defined below) (in effect immediately prior to such Guarantor Payment) bore to the aggregate Allocable Amounts of all of the Guarantors in effect immediately prior to the making of such Guarantor Payment, then, following the date on which the Obligations shall be paid and satisfied in full and each Guarantor shall have performed all of its obligations hereunder, such Guarantor shall be entitled to receive contribution and indemnification payments from, and be reimbursed by, each of the other Guarantors for the amount of such excess, pro rata based upon their respective Allocable Amounts in effect immediately prior to such Guarantor Payment.

(b)           As of any date of determination, the “Allocable Amount” of any Guarantor shall be equal to the maximum amount of the claim which could then be recovered from such Guarantor under this Guaranty without rendering such claim voidable or avoidable under Section 548 of Chapter 11 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law.

(c)           This Section 8.17 is intended only to define the relative rights of the Guarantors and nothing set forth in this Section 8.17 is intended to or shall impair the obligations of the Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Guaranty.

(d)           The rights of the parties under this Section 8.17 shall be exercisable upon the date the Obligations shall be paid and satisfied in full and each Guarantor shall have performed all of its obligations hereunder.

(e)           The parties hereto acknowledge that the right of contribution and indemnification hereunder shall constitute assets of any Guarantor to which such contribution and indemnification is owing.

ARTICLE IX
THE AGENTS AND THE ISSUING BANKS

Section 9.01           Appointment and Authority.  Each of the Lenders and the Issuing Banks hereby irrevocably appoints Natixis to act on its behalf as the Facility Agent and the Collateral Agent hereunder and under the other Loan Documents and authorizes the Agents to take such actions on its behalf and to exercise such powers as are delegated to such Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto, including but not limited to the execution of Security Documents on behalf of the Secured Parties. The provisions of this Article are solely for the benefit of the Agents, the Lenders and

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the Issuing Banks, and none of the Borrowers nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions.

Section 9.02           Rights as a Lender.  The Person serving as an Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not an Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as an Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrowers or any Subsidiary or other Affiliate thereof as if such Person were not an Agent hereunder and without any duty to account therefor to the Lenders.

Section 9.03           Exculpatory Provisions.  The Agents shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, no Agent:

(a)           shall be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b)           shall have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that such Agent is required to exercise as directed in writing by the Majority Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that such Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose such Agent to liability or that is contrary to any Loan Document or applicable law; and

(c)           shall, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrowers or any of their Affiliates that is communicated to or obtained by the Person serving as Agent or any of its Affiliates in any capacity.

Neither Agent shall be liable for any action taken or not taken by it (i) with the consent or at the written request of the Majority Lenders (or such other number or percentage of the Lenders as shall be necessary, or as such Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 10.01) or (ii) in the absence of its own gross negligence or willful misconduct. Each Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to such Agent by a Borrower, a Lender or an Issuing Bank.

Neither Agent shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this

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Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article III or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to such Agent.

Section 9.04           Reliance by Agent.  Each Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Each Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of an Advance, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or an Issuing Bank, the Facility Agent may presume that such condition is satisfactory to such Lender or such Issuing Bank unless the Facility Agent shall have received notice to the contrary from such Lender or such Issuing Bank prior to the making of such Advance or the issuance of such Letter of Credit. Each Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

Section 9.05           Delegation of Duties.  Each Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by such Agent. Each Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of such Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as an Agent.

Section 9.06           Resignation of Agents.  Either Agent may at any time give notice of its resignation to the Lenders, the Issuing Banks and the Borrower. Upon receipt of any such notice of resignation, the Majority Lenders shall have the right, in consultation with the Borrowers, to appoint a successor, which shall be a bank with an office in New York, or an Affiliate of any such bank with an office in New York. If no such successor shall have been so appointed by the Majority Lenders and shall have accepted such appointment within 30 days after the retiring Agent gives notice of its resignation, then the retiring Agent may on behalf of the Lenders and the Issuing Banks, appoint a successor Agent meeting the qualifications set forth above provided that if the Agent shall notify the Borrowers and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (1) the retiring Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Collateral Agent on behalf of the Lenders or the Issuing Banks under any of the Loan Documents, the retiring Collateral Agent shall continue to hold such collateral security until such time as a successor Collateral Agent is appointed) and (2) all payments, communications and determinations provided to be made by, to or through such Agent shall instead be made by or to each Lender and each Issuing Bank directly, until such time as the Majority Lenders appoint a successor Agent as provided for above in this paragraph. Upon

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the acceptance of a successor’s appointment as Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Agent, and the retiring Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this paragraph). The fees payable by the Borrowers to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrowers and such successor. After the retiring Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article and Section 10.04 shall continue in effect for the benefit of such retiring Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Agent was acting as Agent.

Any resignation by the Facility Agent pursuant to this Section shall also constitute its resignation as Issuing Bank.  Upon the acceptance of a successor’s appointment as Facility Agent hereunder, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Issuing Bank, (b) the retiring Issuing Bank shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor Issuing Bank shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangement satisfactory to the retiring Issuing Bank to effectively assume the obligations of the retiring Issuing Bank with respect to such Letters of Credit.

Section 9.07           Non-Reliance on Mandated Lead Arrangers, Joint Bookrunners, Agents and Other Lenders.  Each Lender and Issuing Bank acknowledges that it has, independently and without reliance upon any Mandated Lead Arranger, any Joint Bookrunner, any Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender and Issuing Bank also acknowledges that it will, independently and without reliance upon any Mandated Lead Arranger, any Joint Bookrunner, any Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

Section 9.08           Indemnification.  WHETHER OR NOT THE TRANSACTIONS CONTEMPLATED HEREBY ARE CONSUMMATED, THE LENDERS SEVERALLY AGREE TO INDEMNIFY UPON DEMAND EACH MANDATED LEAD ARRANGER, EACH JOINT BOOKRUNNER, EACH AGENT, EACH ISSUING BANK AND EACH RELATED PARTY OF ANY OF THE FOREGOING (TO THE EXTENT NOT REIMBURSED BY THE LOAN PARTIES), ACCORDING TO THEIR RESPECTIVE PRO RATA SHARES, AND HOLD HARMLESS EACH INDEMNITEE FROM AND AGAINST ANY AND ALL INDEMNIFIED LIABILITIES IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE NEGLIGENCE OF ANY RELATED PARTY; PROVIDED, HOWEVER THAT NO LENDER SHALL BE LIABLE FOR THE PAYMENT TO ANY RELATED PARTY FOR ANY PORTION OF SUCH INDEMNIFIED LIABILITIES TO THE EXTENT DETERMINED IN A FINAL, NONAPPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE RESULTED FROM SUCH RELATED PARTY’S OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT; PROVIDED, HOWEVER, THAT NO ACTION TAKEN IN ACCORDANCE WITH THE DIRECTIONS OF THE MAJORITY LENDERS SHALL BE DEEMED TO CONSTITUTE GROSS NEGLIGENCE OR WILLFUL

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MISCONDUCT FOR PURPOSES OF THIS SECTION.  WITHOUT LIMITATION OF THE FOREGOING, EACH LENDER AGREES TO REIMBURSE THE MANDATED LEAD ARRANGERS, THE JOINT BOOKRUNNERS, THE AGENTS AND THE ISSUING BANKS PROMPTLY UPON DEMAND FOR ITS RATABLE SHARE OF ANY OUT-OF-POCKET EXPENSES (INCLUDING ALL FEES, EXPENSES AND DISBURSEMENTS OF ANY LAW FIRM OR OTHER EXTERNAL COUNSEL AND, WITHOUT DUPLICATION, THE ALLOCATED COST OF INTERNAL LEGAL SERVICES AND ALL EXPENSES AND DISBURSEMENTS OF INTERNAL COUNSEL) INCURRED BY ANY AGENT OR ANY ISSUING BANK IN CONNECTION WITH THE PREPARATION, EXECUTION, DELIVERY, ADMINISTRATION, MODIFICATION, AMENDMENT, OR ENFORCEMENT (WHETHER THROUGH NEGOTIATIONS, LEGAL PROCEEDINGS, OR OTHERWISE) OF, OR LEGAL ADVICE IN RESPECT OF RIGHTS OR RESPONSIBILITIES UNDER, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, TO THE EXTENT THAT SUCH AGENT OR SUCH ISSUING BANK IS NOT REIMBURSED FOR SUCH BY THE LOAN PARTIES.  THE UNDERTAKING IN THIS SECTION SHALL SURVIVE TERMINATION OF THE COMMITMENTS, THE PAYMENT OF ALL OTHER OBLIGATIONS AND THE RESIGNATION OF ANY AGENT.

Section 9.09           Collateral and Guaranty Matters.

(a)           The Secured Parties irrevocably authorize the Collateral Agent, at its option and in its discretion, without the necessity of any notice to or further consent from the Secured Parties:

(i)            to release any Lien on any property granted to or held by the Collateral Agent under any Security Document (x) upon termination of the Commitments and payment in full of all Obligations (other than contingent indemnification obligations) and the expiration or termination of all Letters of Credit, (y) that is sold or to be sold as part of or in connection with any sale permitted hereunder or under any other Loan Document, or (z) subject to Section 10.01, if approved, authorized or ratified in writing by all of the Lenders;

(ii)           to take any actions, including execution on behalf of the Secured Parties, with respect to any Collateral or Security Documents which may be necessary to perfect and maintain Acceptable Security Interests in and Liens upon the Collateral granted pursuant to the Security Documents.

(iii)          to take any action in exigent circumstances as may be reasonably necessary to preserve any rights or privileges of the Secured Parties under the Loan Documents or applicable Legal Requirements.

(b)           Upon the written request of the Collateral Agent at any time, the Lenders will confirm in writing the Collateral Agent’s authority to release particular types or items of Collateral pursuant to this Section 9.09.

(c)           Each Loan Party hereby irrevocably appoints the Collateral Agent as such Loan Party’s attorney-in-fact, with full authority to, after the occurrence of a Default, act for such Loan Party and in the name of such Loan Party to, in the Collateral Agent’s discretion upon the occurrence and during the continuance of Default, file one or more financing or continuation

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statements, and amendments thereto, relative to all or any part of the Collateral without the signature of such Loan Party where permitted by law, to receive, endorse, and collect any drafts or other instruments, documents, and chattel paper which are part of the Collateral, and to ask, demand, collect, sue for, recover, compromise, receive, and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral and to file any claims or take any action or institute any proceedings which the Collateral Agent may reasonably deem necessary or desirable for the collection of any of the Collateral or otherwise to enforce the rights of the Collateral Agent with respect to any of the Collateral.  The power of attorney granted hereby is coupled with an interest and is irrevocable.

(d)           If any Loan Party fails to perform any covenant contained in this Agreement or the other Security Documents, the Collateral Agent may itself perform, or cause performance of, such covenant, and such Loan Party shall pay for the expenses of the Collateral Agent incurred in connection therewith in accordance with Section 10.04.

(e)           The powers conferred on the Collateral Agent under this Agreement and the other Security Documents are solely to protect its interest in the Collateral and shall not impose any duty upon it to exercise any such powers.  Beyond the safe custody thereof, each Agent and each Lender shall have no duty with respect to any Collateral in its possession or control (or in the possession or control of any agent or bailee) or with respect to any income thereon or the preservation of rights against prior parties or any other rights pertaining thereto. The Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which the Collateral Agent accords its own property.  Neither Agent nor any Lender shall be liable or responsible for any loss or damage to any of the Collateral, or for any diminution in the value thereof, by reason of the act or omission of any warehouseman, carrier, forwarding agency, consignee, broker or other agent or bailee selected by Borrower or selected by any Agent in good faith.

Section 9.10           No Other Duties, etc.  Anything herein to the contrary notwithstanding, none of the Joint Bookrunners, Mandated Lead Arrangers, Documentation Agent or Syndication Agent listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Facility Agent, Collateral Agent, a Lender or an Issuing Bank.

ARTICLE X
MISCELLANEOUS

Section 10.01         Amendments, Etc.  No amendment or waiver of any provision of this Agreement or any other Loan Document (other than the Fee Letters), and no consent to any departure by any Borrower or any other Loan Party therefrom, shall in any event be effective unless the same shall be in writing and signed by the Majority Lenders and the Borrowers, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that no amendment, waiver or consent shall:

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(a)           waive any condition set forth in Article III (other than Sections 3.02(d) and (e)) without the written consent of each Lender;

(b)           extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 7.02) without the written consent of such Lender or increase the Aggregate Commitments, the Aggregate Term Commitments, the Aggregate Top-Up Commitments, the Aggregate Revolving Commitments or the aggregate Tranche of any Commitment without the written consent of each Lender;

(c)           postpone any date fixed by this Agreement or any other Loan Document for any payment or mandatory prepayment of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

(d)           reduce the principal of, or the rate of interest specified herein on, any Advance or Reimbursement Obligation, or (subject to clause (v) of the second proviso to this Section 10.01) any fees or other amounts payable hereunder or under any other Loan Document, or change the manner of computation of any financial ratio (including any change in any applicable defined term) used in determining the Applicable Margin that would result in a reduction of any interest rate on any Advance or any fee payable hereunder without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Majority Lenders shall be necessary to waive any obligation of any Borrower to pay interest at the Default Rate;

(e)           change Section 2.12 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender;

(f)            change any provision of this Section or the definition of “Majority Lenders”, “Super-Majority Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender;

(g)           release any Guarantor from its guaranty of the Obligations or any of the Collateral without the written consent of each Lender;

(h)           change the provisions of any Loan Document in a manner that by its terms adversely affects the rights in respect of payments due to Lenders holding one Class of Advances differently from the rights in respect of payments due to Lenders holding another Class of Advances without the prior written consent of each Lender;

(i)            amend Section 7.06 without the written consent of each Lender;

(j)            amend Sections 2.07(c) or (d) or any definitions used therein without the written consent of each Lender directly affected thereby;

(k)           agree to any extension of any Delivery Date without the written consent of each Joint Bookrunner in consultation with the Majority Lenders;

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and, provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the Issuing Banks in addition to the Lenders required above, affect the rights or duties of the Issuing Banks under this Agreement or any Letter of Credit Application relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Facility Agent in addition to the Lenders required above, affect the rights or duties of the Facility Agent under this Agreement or any other Loan Document; (iii) Section 10.06(g) may not be amended, waived or otherwise modified without the consent of each Granting Lender all or any part of whose Advances are being funded by an SPC at the time of such amendment, waiver or other modification; (iv) either Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto; (v) Schedule 1.01(a) may be modified at any time by the Majority Lenders; (vi) the Rig Construction Contracts may be amended, modified, or supplemented at any time with the consent of the Facility Agent acting upon instruction from the Majority Lenders and (vii) Section 3.02(d) and Section 3.02(e) may be modified at any time by the Joint Bookrunners in consultation with the Majority Lenders.

Section 10.02         Notices, Etc.

(a)           General.  Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in paragraph (c) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail, sent by telecopier or (subject to subsection (c) below) electronic mail address as follows:

(i)            if to the Borrowers or any other Loan Party, the Facility Agent or the Issuing Banks, to the address, facsimile number, electronic mail address or telephone number specified for such Person on Schedule 10.02 or to such other address, facsimile number, electronic mail address or telephone number as shall be designated by such party in a notice to the other parties; and

(ii)           if to any other Lender, to the address, facsimile number, electronic mail address or telephone number specified in its Administrative Questionnaire or to such other address, facsimile number, electronic mail address or telephone number as shall be designated by such party in a notice to the Facility Agent.

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications to the extent provided in paragraph (c) below, shall be effective as provided in said paragraph (c).  In no event shall a voicemail message be effective as a notice, communication or confirmation hereunder.

(b)           Effectiveness of Facsimile Documents and Signatures.  Loan Documents may be transmitted and/or signed by facsimile.  The effectiveness of any such documents and signatures shall, subject to applicable Legal Requirements, have the same force and effect as manually-signed originals and shall be binding on all Loan Parties, the Facility Agent and the Lenders. 

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The Facility Agent may also require that any such documents and signatures be confirmed by a manually-signed original thereof; provided, however, that the failure to request or deliver the same shall not limit the effectiveness of any facsimile document or signature.

(c)           Limited Use of Electronic Mail.  Notices and other communications to the Lenders and the Issuing Banks hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Facility Agent, provided that the foregoing shall not apply to notices to any Lender or any Issuing Bank pursuant to Article II if such Lender or Issuing Bank, as applicable, has notified the Facility Agent that it is incapable of receiving notices under such Article by electronic communication. The Facility Agent or the Borrowers may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications. Unless the Facility Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.

(d)           Reliance by Facility Agent and Lenders.  The Facility Agent and the Lenders shall be entitled to rely and act upon any notices (including telephonic Borrowing Notices) purportedly given by or on behalf of any Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof.  EACH BORROWER SHALL INDEMNIFY EACH MANDATED LEAD ARRANGER, EACH JOINT BOOKRUNNER, EACH AGENT, EACH ISSUING BANK, EACH LENDER AND THEIR RELATED PARTIES FROM ALL LOSSES, COSTS, EXPENSES AND LIABILITIES RESULTING FROM THE RELIANCE BY SUCH PERSON ON EACH NOTICE PURPORTEDLY GIVEN BY OR ON BEHALF OF SUCH BORROWER.  All telephonic notices to and other communications with the Facility Agent may be recorded by the Facility Agent, and each of the parties hereto hereby consents to such recording.

Section 10.03         No Waiver; Cumulative Remedies.  No failure on the part of any Lender or any Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided in this Agreement are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

Section 10.04         Costs and Expenses.  Each Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Mandated Lead Arrangers, the Joint Bookrunners, the Agents

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and their Affiliates (including the reasonable fees, charges and disbursements of counsel for any Joint Bookrunner or Agent), and shall pay all fees and time charges and disbursements for attorneys who may be employees of any Joint Bookrunner or any Agent, in connection with the syndication of the credit facilities provided for herein, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing Banks in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out-of-pocket expenses incurred by any Mandated Lead Arranger, any Joint Bookrunner, any Agent, any Lender or any Issuing Bank (including the fees, charges and disbursements of any counsel for any Mandated Lead Arranger, any Joint Bookrunner, any Agent, any Lender or any Issuing Bank), and shall pay all fees and time charges for attorneys who may be employees of any Mandated Lead Arranger, any Joint Bookrunner, any Agent, any Lender or any Issuing Bank, in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Advances made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.  The foregoing costs and expenses shall include all search, filing, recording, title insurance and appraisal charges and fees and taxes related thereto, and other out-of-pocket expenses incurred by any Mandated Lead Arranger, any Joint Bookrunner or any Agent and the cost of independent public accountants and other outside experts retained by any Mandated Lead Arranger, any Joint Bookrunner, any Agent or any Lender.  All amounts due under this Section 10.04 shall be payable within ten Business Days after demand therefor.  The agreements in this Section shall survive the termination of the Commitments and repayment of all other Obligations.

SECTION 10.05     Indemnification.  EACH BORROWER SHALL INDEMNIFY EACH AGENT, EACH MANDATED LEAD ARRANGER, EACH JOINT BOOKRUNNER, EACH LENDER, EACH ISSUING BANK, EACH OTHER SECURED PARTY, AND EACH RELATED PARTY OF ANY OF THE FOREGOING PERSONS (EACH SUCH PERSON BEING CALLED AN “INDEMNITEE”) AGAINST, AND HOLD EACH INDEMNITEE HARMLESS FROM, ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, CLAIMS, DEMANDS, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES, OR DISBURSEMENTS (INCLUDING ALL FEES, EXPENSES AND DISBURSEMENTS OF ANY LAW FIRM OR OTHER EXTERNAL COUNSEL AND, WITHOUT DUPLICATION, THE ALLOCATED COST OF INTERNAL LEGAL SERVICES AND ALL EXPENSES AND DISBURSEMENTS OF INTERNAL COUNSEL) OF ANY KIND OR NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST ANY INDEMNITEE IN ANY WAY RELATING TO OR ARISING OUT OF OR IN CONNECTION WITH (A) THE EXECUTION, DELIVERY, ENFORCEMENT, PERFORMANCE, OR ADMINISTRATION OF THIS AGREEMENT, ANY LOAN DOCUMENT, OR ANY OTHER AGREEMENT, LETTER OR INSTRUMENT DELIVERED IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED THEREBY OR THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED THEREBY, (B) ANY COMMITMENT, ADVANCE OR LETTER OF CREDIT OR THE USE OR PROPOSED USE OF THE PROCEEDS THEREFROM (INCLUDING ANY REFUSAL BY AN ISSUING BANK TO HONOR A DEMAND FOR PAYMENT UNDER A LETTER OF CREDIT IF THE DOCUMENTS PRESENTED IN CONNECTION WITH SUCH DEMAND DO NOT STRICTLY COMPLY WITH THE TERMS OF SUCH LETTER OF CREDIT), (C) ANY ACTION TAKEN OR OMITTED BY ANY AGENT OR ANY ISSUING BANK UNDER

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THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT (INCLUDING SUCH AGENT’S AND SUCH ISSUING BANK’S OWN NEGLIGENCE), (D) ANY ACTUAL OR ALLEGED PRESENCE OR RELEASE OF HAZARDOUS MATERIALS ON OR FROM ANY PROPERTY CURRENTLY OR FORMERLY OWNED OR OPERATED BY ANY BORROWER, ANY SUBSIDIARY OR ANY OTHER LOAN PARTY, OR ANY ENVIRONMENTAL LIABILITY RELATED IN ANY WAY TO ANY BORROWER, ANY SUBSIDIARY OR ANY OTHER LOAN PARTY, OR (E) ANY ACTUAL OR PROSPECTIVE CLAIM, LITIGATION, INVESTIGATION OR PROCEEDING RELATING TO ANY OF THE FOREGOING, WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY (INCLUDING ANY INVESTIGATION OF, PREPARATION FOR, OR DEFENSE OF ANY PENDING OR THREATENED CLAIM, INVESTIGATION, LITIGATION OR PROCEEDING) AND REGARDLESS OF WHETHER ANY INDEMNITEE IS A PARTY THERETO (ALL THE FOREGOING, COLLECTIVELY, THE “INDEMNIFIED LIABILITIES”); PROVIDED THAT SUCH INDEMNITY SHALL NOT, AS TO ANY INDEMNITEE, BE AVAILABLE TO THE EXTENT THAT SUCH LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, CLAIMS, DEMANDS, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR DISBURSEMENTS ARE DETERMINED BY A COURT OF COMPETENT JURISDICTION BY FINAL AND NONAPPEALABLE JUDGMENT TO HAVE RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNITEE.

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, NO BORROWER SHALL ASSERT, AND HEREBY WAIVES, ANY CLAIM AGAINST ANY INDEMNITEE, ON ANY THEORY OF LIABILITY, FOR SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL DAMAGES) ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF, THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY, THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, ANY LOAN OR LETTER OF CREDIT OR THE USE OF THE PROCEEDS THEREOF.  NO INDEMNITEE SHALL BE LIABLE FOR ANY DAMAGES ARISING FROM THE USE BY UNINTENDED RECIPIENTS OF ANY INFORMATION OR OTHER MATERIALS DISTRIBUTED BY IT THROUGH TELECOMMUNICATIONS, ELECTRONIC OR OTHER INFORMATION TRANSMISSION SYSTEMS IN CONNECTION WITH THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

ALL AMOUNTS DUE UNDER THIS SECTION 10.05 SHALL BE PAYABLE WITHIN TEN BUSINESS DAYS AFTER DEMAND THEREFOR.  THE AGREEMENTS IN THIS SECTION SHALL SURVIVE THE RESIGNATION OF THE FACILITY AGENT, THE REPLACEMENT OF ANY LENDER, THE TERMINATION OF THE COMMITMENTS AND THE REPAYMENT, SATISFACTION OR DISCHARGE OF ALL THE OTHER OBLIGATIONS.

Section 10.06         Successors and Assigns.

(a)           Generally.  The terms and provisions of this Agreement and the other Loan Documents shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that no Borrower may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this Section, (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) or (i) of this Section, or (iv) to an SPC in accordance with the provisions of

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subsection (h) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void).   Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)           Assignments by Lenders.  Any Lender may assign to one or more Eligible Assignees all or any portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitments, the Advances owing to it, participations in Letter of Credit Obligations) at the time owing to it; provided, however, that

(i)            except in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Advances of the Class being assigned at the time owing to it or in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund (as defined in subsection (g) of this Section) with respect to a Lender, the aggregate amount of the Commitments and Advances of such Lender of the Class being assigned pursuant to each such assignment (determined as of the date of the Assignment and Acceptance with respect to such assignment) shall not be less than $5,000,000;

(ii)           the parties to each such assignment shall execute and deliver to the Facility Agent, for its acceptance and recording in the Register, an Assignment and Acceptance; and

(iii)          each Eligible Assignee (other than an Eligible Assignee that is a Lender or an Affiliate of a Lender) shall pay to the Facility Agent a $3,500 processing and recording fee.  Any such assignment must be ratable as among the Tranches.

Upon such execution, delivery, acceptance and recording thereof by the Facility Agent pursuant to paragraph (c) of this Section, from and after the effective date specified in each Assignment and Acceptance, (A) the Eligible Assignee thereunder shall be a party hereto for all purposes and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, have the rights and obligations of a Lender hereunder and (B) such assigning Lender thereunder shall, to the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights and be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all or the remaining portion of such Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 2.09, 2.11, 10.04 and 10.05 with respect to facts and circumstances occurring prior to the effective date of such assignment.  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section.

(c)           Register.  The Facility Agent shall maintain at its Applicable Lending Office a copy of each Assignment and Acceptance delivered to and accepted by it and a register for the

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recordation of the names and addresses of the Lenders and the Commitments of, and principal amount of the Advances owing to, each Lender from time to time (the “Register”).  The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and each of the Loan Parties, the Facility Agent, the Issuing Banks, and the Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement.  The Register shall be available for inspection by any Loan Party or any Lender at any reasonable time and from time to time upon reasonable prior notice.

(d)           Participations.  Any Lender may at any time, without the consent of, or notice to, any Borrower or the Facility Agent, sell participations to any Person (other than a natural person, a Borrower or any of the Borrowers’ Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Advances (including such Lender’s participations in Letter of Credit Obligations) owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrowers, the Facility Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification described in the first proviso to Section 10.01 that directly affects such Participant.  Subject to subsection (e) of this Section, each Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.08, 2.09, 2.11, 10.04 and 10.05 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 7.05 as though it were a Lender, provided such Participant agrees to be subject to Section 2.12 as though it were a Lender.

(e)           A Participant shall not be entitled to receive any greater payment under Section 2.09 or 2.11 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent.  A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.11 unless the Borrowers are notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrowers, to comply with Section 2.11(e) as though it were a Lender.

(f)            Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(g)           Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”) may grant to a special purpose funding vehicle identified as such in writing from time to time by the Granting Lender to the Facility Agent and the Borrowers (an “SPC”) the

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option to provide all or any part of any Advance that such Granting Lender would otherwise be obligated to make pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to fund any Advance, and (ii) if an SPC elects not to exercise such option or otherwise fails to make all or any part of such Advance, the Granting Lender shall be obligated to make such Advance pursuant to the terms hereof.  Each party hereto hereby agrees that (i) neither the grant to any SPC nor the exercise by any SPC of such option shall increase the costs or expenses or otherwise increase or change the obligations of the Borrowers under this Agreement (including its obligations under Section 3.04), (ii) no SPC shall be liable for any indemnity or similar payment obligation under this Agreement for which a Lender would be liable, and (iii) the Granting Lender shall for all purposes, including the approval of any amendment, waiver or other modification of any provision of any Loan Document, remain the lender of record hereunder.  The making of an Advance by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Advance were made by such Granting Lender.  In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other senior debt of any SPC, it will not institute against, or join any other Person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency, or liquidation proceeding under the laws of the United States or any State thereof.  Notwithstanding anything to the contrary contained herein, any SPC may (i) with notice to, but without prior consent of the Borrowers and the Facility Agent and without paying any processing fee therefor, assign all or any portion of its right to receive payment with respect to any Advance to the Granting Lender and (ii) disclose on a confidential basis any non-public information relating to its funding of Advances to any rating agency, commercial paper dealer or provider of any surety or Guarantee or credit or liquidity enhancement to such SPC.

(h)           Notwithstanding anything to the contrary contained herein, any Lender that is a Fund may create a security interest in all or any portion of the Loans owing to it and the Note, if any, held by it to the trustee for holders of obligations owed, or securities issued, by such Fund as security for such obligations or securities, provided that unless and until such trustee actually becomes a Lender in compliance with the other provisions of this Section 10.06, (i) no such pledge shall release the pledging Lender from any of its obligations under the Loan Documents and (ii) such trustee shall not be entitled to exercise any of the rights of a Lender under the Loan Documents even though such trustee may have acquired ownership rights with respect to the pledged interest through foreclosure or otherwise.

Section 10.07         Confidentiality.  Each of the Facility Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or

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thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to any Loan Party and its obligations, (g) with the consent of the Borrowers or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Facility Agent or any Lender on a nonconfidential basis from a source other than the Borrower.  For purposes of this Section, “Information” means all information received from any Loan Party relating to any Loan Party or any of their respective businesses, other than any such information that is available to the Facility Agent or any Lender on a nonconfidential basis prior to disclosure by any Loan Party, provided that, in the case of information received from a Loan Party after the date hereof, such information is clearly identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.  The Borrowers hereby acknowledge that (a) the Agents, the Joint Bookrunners and/or the Mandated Lead Arrangers will make available to the Lenders materials and/or information provided by or on behalf of the Borrowers hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on IntraLinks or another similar electronic system (the “Platform”) and (b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to the Parent or its securities) (each, a “Public Lender”).  Each of the Borrowers hereby agrees that (w) all Borrower Materials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrowers shall be deemed to have authorized the Agents, the Joint Bookrunners, the Mandated Lead Arrangers and the Lenders to treat such Borrower Materials as not containing any material non-public information with respect to the Borrowers or any securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materials constitute Information, they shall be treated as set forth in this Section 10.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor;” and (z) the Agents, the Joint Bookrunners and the Mandated Lead Arrangers shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform other than that which is designated “Public Investor.”

Section 10.08         Execution in Counterparts.  This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

Section 10.09         Survival of Representations, etc.  All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof.  Such representations and warranties have been or will be relied upon by the Facility Agent and each Lender, regardless of any investigation made by the Facility Agent or any Lender or on their behalf and notwithstanding that the Facility Agent or any Lender may have

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had notice or knowledge of any Default at the time of any Advance, and shall continue in full force and effect as long as any Advance or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

Section 10.10         Severability.  If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions.  The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 10.11         Interest Rate Limitation.  Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”).  If the Facility Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower.  In determining whether the interest contracted for, charged, or received by the Facility Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

Section 10.12         The Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM.  In no event shall any Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to the Loan Parties, any Lender or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrowers’ or the Facility Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided, however, that in no event shall any Agent Party have any liability to the Borrowers, any Lender or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

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Section 10.13         Governing Law.  This Agreement and each of the other Loan Documents shall be governed by and construed in accordance with the laws of the State of New York and the applicable laws of the United States of America.

Section 10.14         SUBMISSION TO JURISDICTION.

(a)           ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK CITY OR OF THE UNITED STATES FOR THE EASTERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LOAN PARTY, THE FACILITY AGENT AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS.  EACH LOAN PARTY, THE FACILITY AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO.  EACH LOAN PARTY, THE FACILITY AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

(b)           Each Loan Party has irrevocably appointed CT Corporation System (the “Process Agent”), with an office on the date hereof at 111 Eighth Ave., New York, New York, 10011, as its agent to receive on its behalf and on behalf of its property service of copies of any summons or complaint or any other process which may be served in any action.  Such service may be made by mailing or delivering a copy of such process to such Loan Party in care of the Process Agent at the Process Agent’s above address, and each Loan Party hereby irrevocably authorizes and directs the Process Agent to accept such service on its behalf.  As an alternative method of service, each Loan Party also irrevocably consents to the service of any and all process in any such action or proceeding by the mailing of copies of such process to it at the address specified for it on the signature pages of this Agreement.

(c)           Nothing in this Section 10.14 shall affect the right of any Agent or any other Lender to serve legal process in any other manner permitted by law or affect the right of any Agent or any Lender to bring any action or proceeding against any Loan Party (as a Borrower or as a Guarantor) in the courts of any other jurisdiction.

Section 10.15         WAIVER OF JURY.  EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY AND IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN

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EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

Section 10.16         ENTIRE AGREEMENT.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

Section 10.17         Judgment Currency.

(a)           The obligations of the Borrowers and the other Loan Parties hereunder and under the other Loan Documents to make payments in U.S. Dollars (the “Obligation Currency”) shall not be discharged or satisfied by any tender or recovery pursuant to any judgment expressed in or converted into any currency other than the Obligation Currency, except to the extent that such tender or recovery results in the effective receipt by the Facility Agent or a Lender or an Issuing Bank of the full amount of the Obligation Currency expressed to be payable to the Facility Agent, such Lender or such Issuing Bank under this Agreement or the other Loan Documents.  If, for the purpose of obtaining or enforcing judgment against any Borrower or any other Loan Party or in any court or in any jurisdiction, it becomes necessary to convert into or from any currency other than the Obligation Currency (such other currency being hereinafter referred to as the “Judgment Currency”) an amount due in the Obligation Currency, the conversion shall be made at the rate of exchange (as quoted by the Facility Agent or if the Facility Agent does not quote a rate of exchange on such currency, by a known dealer in such currency designated by the Facility Agent) determined, in each case, as of the date immediately preceding the day on which the judgment is given (such Business Day being hereinafter referred to as the “Judgment Currency Conversion Date”).

(b)           If there is a change in the rate of exchange prevailing between the Judgment Currency Conversion Date and the date of actual payment of the amount due, such Loan Party covenants and agrees to pay, or cause to be paid, as a separate obligation and notwithstanding any judgment, such additional amounts, if any (but in any event not a lesser amount), as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the rate of exchange prevailing on the date of payment, will produce the amount of the Obligation Currency which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial award at the rate of exchange prevailing on the Judgment Currency Conversion Date.

(c)           For purposes of determining the rate of exchange for this Section, such amounts shall include any premium and costs payable in connection with the purchase of the Obligation Currency.

Section 10.18         USA Patriot Act Notice.  Each Lender and Agent (for itself and not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2003)) (the “Act”), it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of such Loan Party and other information that will

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allow such Lender or the Agent, as applicable, to identify the Loan Parties in accordance with the Act. Each Loan Party shall, following a request by the Agent or any Lender, provide all documentation and other information that the Agent or such Lender reasonably requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Act.

Section 10.19         Fee Letters.  The Parent hereby assumes the obligations, covenants and agreements of Vantage Energy under each of the Fee Letters.

[Signature pages follow.]

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EXECUTED as of date first set forth above.

BORROWERS:
EMERALD DRILLER COMPANY
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
SAPPHIRE DRILLER COMPANY
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
AQUAMARINE DRILLER COMPANY
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
TOPAZ DRILLER COMPANY
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer

Signature Page to Credit Agreement

GUARANTORS:
VANTAGE DRILLING COMPANY
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
OFFSHORE GROUP INVESTMENT LIMITED
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
VANTAGE ENERGY SERVICES, INC.
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
VANTAGE INTERNATIONAL MANAGEMENT CO.
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
VANTAGE INTERNATIONAL PAYROLL CO.
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer

Signature Page to Credit Agreement

VANTAGE DRILLER I CO
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer
VANTAGE DRILLER II CO
By:	/s/ Paul A. Bragg
	Paul A. Bragg
	Chief Executive Officer

Signature Page to Credit Agreement

AGENTS:
NATIXIS, as Facility Agent and Collateral Agent
By:	/s/ Michel Degermann
Name:			Michel Degermann
Title:		Head of Shipping Finance
By:	/s/ Thomas Bodereau
Name:			Thomas Bodereau
Title:		VP

Signature Page to Credit Agreement

JOINT BOOKRUNNERS:
NATIXIS
By:		/s/ Michel Degermann
Name:				Michel Degermann
Title:			Head of Shipping Finance
By:		/s/ Thomas Bodereau
Name:				Thomas Bodereau
Title:			VP
FORTIS BANK S.A./N.V., NEW YORK BRANCH
By:		/s/ Eric Chilton
Name:				Eric Chilton
Title:			Managing Director
By:		/s/ John G. Sullivan
Name:				John G. Sullivan
Title:			Managing Director
BTMU CAPITAL CORPORATION
By:	/s/ Cheryl A. Behan
	Cheryl A. Behan
	Senior Vice President

Signature Page to Credit Agreement

LENDERS:
FORTIS BANK S.A./N.V., NEW YORK BRANCH
By:	/s/ Eric Chilton
Name:	Eric Chilton
Title:	Managing Director
By:	/s/ John G. Sullivan
Name:	John G. Sullivan
Title:	Managing Director
NATIXIS
By:	/s/ Michel Degermann
Name:	Michel Degermann
Title:	Head of Shipping Finance
By:	/s/ Thomas Bodereau
Name:	Thomas Bodereau
Title:	VP
BTMU CAPITAL CORPORATION
By:	/s/ Cheryl A. Behan
	Cheryl A. Behan
	Senior Vice President

Signature Page to Credit Agreement

EX-10.2

Exhibit 10.2

VANTAGE DRILLING COMPANY

2007 LONG-TERM INCENTIVE COMPENSATION PLAN

ARTICLE I

PURPOSE

Section 1.1  Purpose.  This 2007 Long-Term Incentive Compensation Plan (the “Plan”), originally established by Vantage Energy Services, Inc., a Delaware corporation, and subsequently adopted by Vantage Drilling Company (the “Company”), is to create incentives which are designed to motivate Participants to put forth maximum effort toward the success and growth of the Company and to enable the Company to attract and retain experienced individuals who by their position, ability and diligence are able to make important contributions to the Company’s success. Toward these objectives, the Plan provides for the grant of Options, Restricted Stock Awards, Stock Appreciation Rights (“SARs”), Performance Units and Performance Bonuses to Eligible Employees and the grant of Nonqualified Stock Options, Restricted Stock Awards, SARs and Performance Units to Consultants and Eligible Directors, subject to the conditions set forth in the Plan.

Section 1.2  Establishment.  The Plan is effective as of June 12, 2008 and for a period of ten years thereafter. The Plan shall continue in effect until all matters relating to the payment of Awards and administration of the Plan have been settled. The Plan is subject to approval by the Company’s stockholders in accordance with applicable law which approval must occur within the period ending twelve months after the date the Plan is adopted by the Board. Pending such approval by the stockholders, Awards under the Plan may be granted, but no such Awards may be exercised prior to receipt of stockholder approval. In the event stockholder approval is not obtained within a twelve-month period, all Awards granted shall be void.

Section 1.3  Shares Subject to the Plan.  Subject to the limitations set forth in the Plan, Awards may be made under this Plan for a total of 7,500,000 shares of the Company’s ordinary shares, par value $.001 per share (the “Common Stock”).

ARTICLE II

DEFINITIONS

Section 2.1  “Account” means the recordkeeping account established by the Company to which will be credited an Award of Performance Units to a Participant.

Section 2.2  “Affiliated Entity” means any corporation, partnership, limited liability company or other form of legal entity in which a majority of the partnership or other similar interest thereof is owned or controlled, directly or indirectly, by the Company or one or more of its Subsidiaries or Affiliated Entities or a combination thereof. For purposes hereof, the Company, a Subsidiary or an Affiliated Entity shall be deemed to have a majority ownership interest in a partnership or limited liability company if the Company, such Subsidiary or Affiliated Entity shall be allocated a majority of partnership or limited liability company gains or losses or shall be or control a managing director or a general partner of such partnership or limited liability company.

Section 2.3  “Award” means, individually or collectively, any Option, Restricted Stock Award, SAR, Performance Unit or Performance Bonus granted under the Plan to an Eligible Employee by the Board or any Nonqualified Stock Option, Performance Unit SAR or Restricted Stock Award granted under the Plan to a Consultant or an Eligible Director by the Board pursuant to such terms, conditions, restrictions, and/or limitations, if any, as the Board may establish by the Award Agreement or otherwise.

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Section 2.4  “Award Agreement” means any written instrument that establishes the terms, conditions, restrictions, and/or limitations applicable to an Award in addition to those established by this Plan and by the Board’s exercise of its administrative powers.

Section 2.5  “Board” means the Board of Directors of the Company and, if the Board has appointed a Committee as provided in Section 3.1, the term “Board” shall include such Committee.

Section 2.6  “Change of Control Event” means each of the following:

(i)Any transaction in which shares of voting securities of the Company representing more than 50% of the total combined voting power of all outstanding voting securities of the Company are issued by the Company, or sold or transferred by the stockholders of the Company as a result of which those persons and entities who beneficially owned voting securities of the Company representing more than 50% of the total combined voting power of all outstanding voting securities of the Company immediately prior to such transaction cease to beneficially own voting securities of the Company representing more than 50% of the total combined voting power of all outstanding voting securities of the Company immediately after such transaction;

(ii)The merger or consolidation of the Company with or into another entity as a result of which those persons and entities who beneficially owned voting securities of the Company representing more than 50% of the total combined voting power of all outstanding voting securities of the Company immediately prior to such merger or consolidation cease to beneficially own voting securities of the Company representing more than 50% of the total combined voting power of all outstanding voting securities of the surviving corporation or resulting entity immediately after such merger of consolidation; or

(iii)The sale of all or substantially all of the Company’s assets to an entity of which those persons and entities who beneficially owned voting securities of the Company representing more than 50% of the total combined voting power of all outstanding voting securities of the Company immediately prior to such asset sale do not beneficially own voting securities of the purchasing entity representing more than 50% of the total combined voting power of all outstanding voting securities of the purchasing entity immediately after such asset sale.

Section 2.7  “Code” means the Internal Revenue Code of 1986, as amended. References in the Plan to any section of the Code shall be deemed to include any amendments or successor provisions to such section and any regulations under such section.

Section 2.8  “Committee” means the Committee appointed by the Board as provided in Section 3.1.

Section 2.9  “Common Stock” means the ordinary shares, par value $.001 per share, of the Company, and after substitution, such other stock as shall be substituted therefore as provided in Article X.

Section 2.10  “Consultant” means any person who is engaged by the Company, a Subsidiary or an Affiliated Entity to render consulting or advisory services.

Section 2.11  “Date of Grant” means the date on which the grant of an Award is authorized by the Board or such later date as may be specified by the Board in such authorization.

Section 2.12  “Disability” means the Participant is unable to continue employment by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months. For purposes of this Plan, the determination of Disability shall be made in the sole and absolute discretion of the Board.

Section 2.13  “Eligible Employee” means any employee of the Company, a Subsidiary, or an Affiliated Entity as approved by the Board.

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Section 2.14  “Eligible Director” means any member of the Board who is not an employee of the Company, a Subsidiary or an Affiliated Entity.

Section 2.15  “Exchange Act” means the Securities Exchange Act of 1934, as amended.

Section 2.16  “Fair Market Value” means (A) during such time as the Common Stock is registered under Section 12 of the Exchange Act, the closing price of the Common Stock as reported by an established stock exchange or automated quotation system on the day for which such value is to be determined, or, if no sale of the Common Stock shall have been made on any such stock exchange or automated quotation system that day, on the next preceding day on which there was a sale of such Common Stock, or (B) during any such time as the Common Stock is not listed upon an established stock exchange or automated quotation system, the mean between dealer “bid” and “ask” prices of the Common Stock in the over-the-counter market on the day for which such value is to be determined, as reported by the National Association of Securities Dealers, Inc., or (C) during any such time as the Common Stock cannot be valued pursuant to (A) or (B) above, the fair market value shall be as determined by the Board considering all relevant information including, by example and not by limitation, the services of an independent appraiser.

Section 2.17  “Incentive Stock Option” means an Option within the meaning of Section 422 of the Code.

Section 2.18  “Nonqualified Stock Option” means an Option which is not an Incentive Stock Option.

Section 2.19  “Option” means an Award granted under Article V of the Plan and includes both Nonqualified Stock Options and Incentive Stock Options to purchase shares of Common Stock.

Section 2.20  “Participant” means an Eligible Employee, a Consultant or an Eligible Director to whom an Award has been granted by the Board under the Plan.

Section 2.21  “Performance Bonus” means the cash bonus which may be granted to Eligible Employees under Article IX of the Plan.

Section 2.22  “Performance Units” means those monetary units that may be granted to Eligible Employees, Consultants or Eligible Directors pursuant to Article VIII hereof.

Section 2.23  “Plan” means this Vantage Energy Services, Inc. 2007 Long-Term Incentive Compensation Plan.

Section 2.24  “Restricted Stock Award” means an Award granted to an Eligible Employee, Consultant or Eligible Director under Article VI of the Plan.

Section 2.25  “Retirement” means the termination of an Eligible Employee’s employment with the Company, a Subsidiary or an Affiliated Entity on or after attaining age     .

Section 2.26  “SAR” means a stock appreciation right granted to an Eligible Employee, Consultant or Eligible Director under Article VII of the Plan.

Section 2.27  “Subsidiary” shall have the same meaning set forth in Section 424 of the Code.

ARTICLE III

ADMINISTRATION

Section 3.1  Administration of the Plan by the Board.  The Board shall administer the Plan. The Board may, by resolution, appoint the Compensation Committee to administer the Plan and delegate its powers described under this Section 3.1 and otherwise under the Plan for purposes of Awards granted to Eligible Employees and Consultants.

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Subject to the provisions of the Plan, the Board shall have exclusive power to:

(a)Select Eligible Employees and Consultants to participate in the Plan.

(b)Determine the time or times when Awards will be made to Eligible Employees or Consultants.

(c)Determine the form of an Award, whether an Incentive Stock Option, Nonqualified Stock Option, Restricted Stock Award, SAR, Performance Unit, or Performance Bonus, the number of shares of Common Stock or Performance Units subject to the Award, the amount and all the terms, conditions (including performance requirements), restrictions and/or limitations, if any, of an Award, including the time and conditions of exercise or vesting, and the terms of any Award Agreement, which may include the waiver or amendment of prior terms and conditions or acceleration or early vesting or payment of an Award under certain circumstances determined by the Board.

(d)Determine whether Awards will be granted singly or in combination.

(e)Accelerate the vesting, exercise or payment of an Award or the performance period of an Award.

(f)Determine whether and to what extent a Performance Bonus may be deferred, either automatically or at the election of the Participant or the Board.

(g)Take any and all other action it deems necessary or advisable for the proper operation or administration of the Plan.

Section 3.2  Administration of Grants to Eligible Directors.  The Board shall have the exclusive power to select Eligible Directors to participate in the Plan and to determine the number of Nonqualified Stock Options, Performance Units, SARs or shares of Restricted Stock awarded to Eligible Directors selected for participation. If the Board appoints a committee to administer the Plan, it may delegate to the committee administration of all other aspects of the Awards made to Eligible Directors.

Section 3.3  Board to Make Rules and Interpret Plan.  The Board in its sole discretion shall have the authority, subject to the provisions of the Plan, to establish, adopt, or revise such rules and regulations and to make all such determinations relating to the Plan, as it may deem necessary or advisable for the administration of the Plan. The Board’s interpretation of the Plan or any Awards and all decisions and determinations by the Board with respect to the Plan shall be final, binding, and conclusive on all parties.

Section 3.4  Section 162(m) Provisions.  The Company intends for the Plan and the Awards made there under to qualify for the exception from Section 162(m) of the Code for “qualified performance based compensation” if it is determined by the Board that such qualification is necessary for an Award. Accordingly, the Board shall make determinations as to performance targets and all other applicable provisions of the Plan as necessary in order for the Plan and Awards made there under to satisfy the requirements of Section 162(m) of the Code.

ARTICLE IV

GRANT OF AWARDS

Section 4.1  Grant of Awards.  Awards granted under this Plan shall be subject to the following conditions:

(a)Any shares of Common Stock related to Awards which terminate by expiration, forfeiture, cancellation or otherwise without the issuance of shares of Common Stock or are exchanged in the

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Board’s discretion for Awards not involving Common Stock, shall be available again for grant under the Plan and shall not be counted against the shares authorized under Section 1.3.

(b)Common Stock delivered by the Company in payment of an Award authorized under Articles V and VI of the Plan may be authorized and unissued Common Stock or Common Stock held in the treasury of the Company.

(c)The Board shall, in its sole discretion, determine the manner in which fractional shares arising under this Plan shall be treated.

(d)Separate certificates or a book-entry registration representing Common Stock shall be delivered to a Participant upon the exercise of any Option.

(e)The Board shall be prohibited from canceling, reissuing or modifying Awards if such action will have the effect of repricing the Participant’s Award.

(f)Eligible Directors may only be granted Nonqualified Stock Options, Restricted Stock Awards, SARs or Performance Units under this Plan.

(g)The maximum term of any Award shall be ten years.

ARTICLE V

STOCK OPTIONS

Section 5.1  Grant of Options.  The Board may, from time to time, subject to the provisions of the Plan and such other terms and conditions as it may determine, grant Options to Eligible Employees. These Options may be Incentive Stock Options or Nonqualified Stock Options, or a combination of both. The Board may, subject to the provisions of the Plan and such other terms and conditions as it may determine, grant Nonqualified Stock Options to Eligible Directors and Consultants. Each grant of an Option shall be evidenced by an Award Agreement executed by the Company and the Participant, and shall contain such terms and conditions and be in such form as the Board may from time to time approve, subject to the requirements of Section 5.2.

Section 5.2  Conditions of Options.  Each Option so granted shall be subject to the following conditions:

(a)Exercise Price.  As limited by Section 5.2(e) below, each Option shall state the exercise price which shall be set by the Board at the Date of Grant; provided, however, no Option shall be granted at an exercise price which is less than the Fair Market Value of the Common Stock on the Date of Grant.

(b)Form of Payment.  The exercise price of an Option may be paid (i) in cash or by check, bank draft or money order payable to the order of the Company; (ii) by delivering shares of Common Stock having a Fair Market Value on the date of payment equal to the amount of the exercise price, but only to the extent such exercise of an Option would not result in an adverse accounting charge to the Company for financial accounting purposes with respect to the shares used to pay the exercise price unless otherwise determined by the Board; or (iii) a combination of the foregoing. In addition to the foregoing, the Board may permit an Option granted under the Plan to be exercised by a broker-dealer acting on behalf of a Participant through procedures approved by the Board.

(c)Exercise of Options.  Options granted under the Plan shall be exercisable, in whole or in such installments and at such times, and shall expire at such time, as shall be provided by the Board in the Award Agreement. Exercise of an Option shall be by written notice to the Secretary of the Company at least two business days in advance of such exercise stating the election to exercise in the form and manner determined by the Board. Every share of Common Stock

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acquired through the exercise of an Option shall be deemed to be fully paid at the time of exercise and payment of the exercise price.

(d)Other Terms and Conditions.  Among other conditions that may be imposed by the Board, if deemed appropriate, are those relating to (i) the period or periods and the conditions of exercisability of any Option; (ii) the minimum periods during which Participants must be employed by the Company, its Subsidiaries, or an Affiliated Entity, or must hold Options before they may be exercised; (iii) the minimum periods during which shares acquired upon exercise must be held before sale or transfer shall be permitted; (iv) conditions under which such Options or shares may be subject to forfeiture; (v) the frequency of exercise or the minimum or maximum number of shares that may be acquired at any one time; (vi) the achievement by the Company of specified performance criteria; and (vii) non-compete and protection of business matters.

(e)Special Restrictions Relating to Incentive Stock Options.  Options issued in the form of Incentive Stock Options shall only be granted to Eligible Employees of the Company or a Subsidiary, and not to Eligible Employees of an Affiliated Entity unless such entity shall be considered as a “disregarded entity” under the Code and shall not be distinguished for federal tax purposes from the Company or the applicable Subsidiary.

(f)Application of Funds.  The proceeds received by the Company from the sale of Common Stock pursuant to Options will be used for general corporate purposes.

(g)Stockholder Rights.  No Participant shall have a right as a stockholder with respect to any share of Common Stock subject to an Option prior to purchase of such shares of Common Stock by exercise of the Option.

ARTICLE VI

RESTRICTED STOCK AWARDS

Section 6.1  Grant of Restricted Stock Awards.  The Board may, from time to time, subject to the provisions of the Plan and such other terms and conditions as it may determine, grant a Restricted Stock Award to Eligible Employees, Consultants or Eligible Directors. Restricted Stock Awards shall be awarded in such number and at such times during the term of the Plan as the Board shall determine. Each Restricted Stock Award shall be subject to an Award Agreement setting forth the terms of such Restricted Stock Award and may be evidenced in such manner as the Board deems appropriate, including, without limitation, a book-entry registration or issuance of a stock certificate or certificates.

Section 6.2  Conditions of Restricted Stock Awards.  The grant of a Restricted Stock Award shall be subject to the following:

(a)Restriction Period.  Restricted Stock Awards granted to an Eligible Employee shall require the holder to remain in the employment of the Company, a Subsidiary, or an Affiliated Entity for a prescribed period. Restricted Stock Awards granted to Consultants or Eligible Directors shall require the holder to provide continued services to the Company for a period of time. These employment and service requirements are collectively referred to as a “Restriction Period”. The Board or the Committee, as the case may be, shall determine the Restriction Period or Periods which shall apply to the shares of Common Stock covered by each Restricted Stock Award or portion thereof. In addition to any time vesting conditions determined by the Board or the Committee, as the case may be, Restricted Stock Awards may be subject to the achievement by the Company of specified performance criteria based upon the Company’s achievement of all or any of the operational, financial or stock performance criteria set forth on Exhibit A annexed hereto, as may from time to time be established by the Board or the Committee, as the case may be. At the end of the Restriction Period, assuming the fulfillment of any other specified vesting conditions, the restrictions imposed by the Board or the Committee, as the case may be shall lapse

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with respect to the shares of Common Stock covered by the Restricted Stock Award or portion thereof. In addition to acceleration of vesting upon the occurrence of a Change of Control Event as provided in Section 11.5, the Board or the Committee, as the case may be, may, in its discretion, accelerate the vesting of a Restricted Stock Award in the case of the death, Disability or Retirement of the Participant who is an Eligible Employee or resignation of a Participant who is a Consultants or an Eligible Director.

(b)Restrictions.  The holder of a Restricted Stock Award may not sell, transfer, pledge, exchange, hypothecate, or otherwise dispose of the shares of Common Stock represented by the Restricted Stock Award during the applicable Restriction Period. The Board shall impose such other restrictions and conditions on any shares of Common Stock covered by a Restricted Stock Award as it may deem advisable including, without limitation, restrictions under applicable Federal or state securities laws, and may legend the certificates representing Restricted Stock to give appropriate notice of such restrictions.

(c)Rights as Stockholders.  During any Restriction Period, the Board may, in its discretion, grant to the holder of a Restricted Stock Award all or any of the rights of a stockholder with respect to the shares, including, but not by way of limitation, the right to vote such shares and to receive dividends. If any dividends or other distributions are paid in shares of Common Stock, all such shares shall be subject to the same restrictions on transferability as the shares of Restricted Stock with respect to which they were paid.

ARTICLE VII

STOCK APPRECIATION RIGHTS

Section 7.1  Grant of SARs.  The Board may from time to time, in its sole discretion, subject to the provisions of the Plan and subject to other terms and conditions as the Board may determine, grant a SAR to any Eligible Employee, Consultant or Eligible Director. SARs may be granted in tandem with an Option, in which event, the Participant has the right to elect to exercise either the SAR or the Option. Upon the Participant’s election to exercise one of these Awards, the other tandem Award is automatically terminated. SARs may also be granted as an independent Award separate from an Option. Each grant of a SAR shall be evidenced by an Award Agreement executed by the Company and the Participant and shall contain such terms and conditions and be in such form as the Board may from time to time approve, subject to the requirements of the Plan. The exercise price of the SAR shall not be less than the Fair Market Value of a share of Common Stock on the Date of Grant of the SAR.

Section 7.2  Exercise and Payment.  SARs granted under the Plan shall be exercisable in whole or in installments and at such times as shall be provided by the Board in the Award Agreement. Exercise of a SAR shall be by written notice to the Secretary of the Company at least two business days in advance of such exercise. The amount payable with respect to each SAR shall be equal in value to the excess, if any, of the Fair Market Value of a share of Common Stock on the exercise date over the exercise price of the SAR. Payment of amounts attributable to a SAR shall be made in shares of Common Stock.

Section 7.3  Restrictions.  In the event a SAR is granted in tandem with an Incentive Stock Option, the Board shall subject the SAR to restrictions necessary to ensure satisfaction of the requirements under Section 422 of the Code. In the case of a SAR granted in tandem with an Incentive Stock Option to an Eligible Employee who owns more than 10% of the combined voting power of the Company or its Subsidiaries on the date of such grant, the amount payable with respect to each SAR shall be equal in value to the applicable percentage of the excess, if any, of the Fair Market Value of a share of Common Stock on the Exercise date over the exercise price of the SAR,

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which exercise price shall not be less than 110% of the Fair Market Value of a share of Common Stock on the date the SAR is granted.

ARTICLE VIII

PERFORMANCE UNITS

Section 8.1  Grant of Awards.  The Board may, from time to time, subject to the provisions of the Plan and such other terms and conditions as it may determine, grant Performance Units to Eligible Employees, Consultants and Eligible Directors. Each Award of Performance Units shall be evidenced by an Award Agreement executed by the Company and the Participant, and shall contain such terms and conditions and be in such form as the Board may from time to time approve, subject to the requirements of Section 8.2.

Section 8.2  Conditions of Awards.  Each Award of Performance Units shall be subject to the following conditions:

(a)Establishment of Award Terms.  Each Award shall state the target, maximum and minimum value of each Performance Unit payable upon the achievement of performance goals.

(b)Achievement of Performance Goals.  The Board shall establish performance targets for each Award for a period of no less than a year based upon some or all of the operational, financial or performance criteria listed in Exhibit A attached. The Board shall also establish such other terms and conditions as it deems appropriate to such Award. The Award may be paid out in cash or Common Stock as determined in the sole discretion of the Board.

ARTICLE IX

PERFORMANCE BONUS

Section 9.1  Grant of Performance Bonus.  The Board may from time to time, subject to the provisions of the Plan and such other terms and conditions as the Board may determine, grant a Performance Bonus to certain Eligible Employees selected for participation. The Board will determine the amount that may be earned as a Performance Bonus in any period of one year or more upon the achievement of a performance target established by the Board. The Board shall select the applicable performance target(s) for each period in which a Performance Bonus is awarded. The performance target shall be based upon all or some of the operational, financial or performance criteria more specifically listed in Exhibit A attached.

Section 9.2  Payment of Performance Bonus.  In order for any Participant to be entitled to payment of a Performance Bonus, the applicable performance target(s) established by the Board must first be obtained or exceeded. Payment of a Performance Bonus shall be made within 60 days of the Board’s certification that the performance target(s) has been achieved unless the Participant has previously elected to defer payment pursuant to a nonqualified deferred compensation plan adopted by the Company. Payment of a Performance Bonus may be made in either cash or Common Stock as determined in the sole discretion of the Board.

ARTICLE X

STOCK ADJUSTMENTS

In the event that the shares of Common Stock, as constituted on the effective date of the Plan, shall be changed into or exchanged for a different number or kind of shares of stock or other securities of the Company or of another corporation (whether by reason of merger, consolidation, recapitalization, reclassification, stock split, spin-off, combination of shares or otherwise), or if the number of such shares of Common Stock shall be increased through the payment of a stock dividend, or a dividend on the shares of Common Stock, or if rights or warrants to purchase securities of the

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Company shall be issued to holders of all outstanding Common Stock, then there shall be substituted for or added to each share available under and subject to the Plan, and each share theretofore appropriated under the Plan, the number and kind of shares of stock or other securities into which each outstanding share of Common Stock shall be so changed or for which each such share shall be exchanged or to which each such share shall be entitled, as the case may be, on a fair and equivalent basis in accordance with the applicable provisions of Section 424 of the Code; provided, however, with respect to Options, in no such event will such adjustment result in a modification of any Option as defined in Section 424(h) of the Code. In the event there shall be any other change in the number or kind of the outstanding shares of Common Stock, or any stock or other securities into which the Common Stock shall have been changed or for which it shall have been exchanged, then if the Board shall, in its sole discretion, determine that such change equitably requires an adjustment in the shares available under and subject to the Plan, or in any Award, theretofore granted, such adjustments shall be made in accordance with such determination, except that no adjustment of the number of shares of Common Stock available under the Plan or to which any Award relates that would otherwise be required shall be made unless and until such adjustment either by itself or with other adjustments not previously made would require an increase or decrease of at least 1% in the number of shares of Common Stock available under the Plan or to which any Award relates immediately prior to the making of such adjustment (the “Minimum Adjustment”). Any adjustment representing a change of less than such minimum amount shall be carried forward and made as soon as such adjustment together with other adjustments required by this Article X and not previously made would result in a Minimum Adjustment. Notwithstanding the foregoing, any adjustment required by this Article X which otherwise would not result in a Minimum Adjustment shall be made with respect to shares of Common Stock relating to any Award immediately prior to exercise, payment or settlement of such Award. No fractional shares of Common Stock or units of other securities shall be issued pursuant to any such adjustment, and any fractions resulting from any such adjustment shall be eliminated in each case by rounding downward to the nearest whole share.

ARTICLE XI

GENERAL

Section 11.1  Amendment or Termination of Plan.  The Board may alter, suspend or terminate the Plan at any time provided, however, that it may not, without stockholder approval, adopt any amendment which would (i) increase the aggregate number of shares of Common Stock available under the Plan (except by operation of Article X), (ii) materially modify the requirements as to eligibility for participation in the Plan, or (iii) materially increase the benefits to Participants provided by the Plan.

Section 11.2  Termination of Employment; Termination of Service.  If an Eligible Employee’s employment with the Company, a Subsidiary or an Affiliated Entity terminates as a result of death, Disability or Retirement, the Eligible Employee (or personal representative in the case of death) shall be entitled to purchase all or any part of the shares subject to any (i) vested Incentive Stock Option for a period of up to three months from such date of termination (one year in the case of death or Disability (as defined above) in lieu of the three-month period), and (ii) vested Nonqualified Stock Option during the remaining term of the Option. If an Eligible Employee’s employment terminates for any other reason, the Eligible Employee shall be entitled to purchase all or any part of the shares subject to any vested Option for a period of up to three months from such date of termination. In no event shall any Option be exercisable past the term of the Option. The Board may, in its sole discretion, accelerate the vesting of unvested Options in the event of termination of employment of any Participant.

In the event a Consultant ceases to provide services to the Company or an Eligible Director terminates service as a director of the Company, the unvested portion of any Award shall be forfeited unless otherwise accelerated pursuant to the terms of the Eligible Director’s Award Agreement or by

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the Board. The Consultant or Eligible Director shall have a period of three years following the date he ceases to provide consulting services or ceases to be a director, as applicable, to exercise any Nonqualified Stock Options which are otherwise exercisable on his date of termination of service.

Section 11.3  Limited Transferability—Options.  The Board may, in its discretion, authorize all or a portion of the Nonqualified Stock Options granted under this Plan to be on terms which permit transfer by the Participant to (i) the ex-spouse of the Participant pursuant to the terms of a domestic relations order, (ii) the spouse, children or grandchildren of the Participant (“Immediate Family Members”), (iii) a trust or trusts for the exclusive benefit of such Immediate Family Members, or (iv) a partnership or limited liability company in which such Immediate Family Members are the only partners or members. In addition, there may be no consideration for any such transfer. The Award Agreement pursuant to which such Nonqualified Stock Options are granted expressly provide for transferability in a manner consistent with this paragraph. Subsequent transfers of transferred Nonqualified Stock Options shall be prohibited except as set forth below in this Section 11.3. Following transfer, any such Nonqualified Stock Options shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, provided that for purposes of Section 11.2 hereof the term “Participant” shall be deemed to refer to the transferee. The events of termination of employment of Section 11.2 hereof shall continue to be applied with respect to the original Participant, following which the Nonqualified Stock Options shall be exercisable by the transferee only to the extent, and for the periods specified in Section 11.2 hereof. No transfer pursuant to this Section 11.3 shall be effective to bind the Company unless the Company shall have been furnished with written notice of such transfer together with such other documents regarding the transfer as the Board shall request. With the exception of a transfer in compliance with the foregoing provisions of this Section 11.3, all other types of Awards authorized under this Plan shall be transferable only by will or the laws of descent and distribution; however, no such transfer shall be effective to bind the Company unless the Board has been furnished with written notice of such transfer and an authenticated copy of the will and/or such other evidence as the Board may deem necessary to establish the validity of the transfer and the acceptance by the transferee of the terms and conditions of such Award.

Section 11.4  Withholding Taxes.  Unless otherwise paid by the Participant, the Company, its Subsidiaries or any of its Affiliated Entities shall be entitled to deduct from any payment under the Plan, regardless of the form of such payment, the amount of all applicable income and employment taxes required by law to be withheld with respect to such payment or may require the Participant to pay to it such tax prior to and as a condition of the making of such payment. In accordance with any applicable administrative guidelines it establishes, the Board may allow a Participant to pay the amount of taxes required by law to be withheld from an Award by (i) directing the Company to withhold from any payment of the Award a number of shares of Common Stock having a Fair Market Value on the date of payment equal to the amount of the required withholding taxes or (ii) delivering to the Company previously owned shares of Common Stock having a Fair Market Value on the date of payment equal to the amount of the required withholding taxes. However, any payment made by the Participant pursuant to either of the foregoing clauses (i) or (ii) shall not be permitted if it would result in an adverse accounting charge with respect to such shares used to pay such taxes unless otherwise approved by the Board.

Section 11.5  Change of Control.  Notwithstanding any other provision in this Plan to the contrary, in the event of a Change of Control Event, the Board shall have the discretion to determine whether and to what extent to accelerate the vesting, exercise or payment of an Award.

Section 11.6  Amendments to Awards.  Subject to the limitations of Article IV, such as the prohibition on repricing of Options, the Board may at any time unilaterally amend the terms of any Award Agreement, whether or not presently exercisable or vested, to the extent it deems appropriate. However, amendments which are adverse to the Participant shall require the Participant’s consent.

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Section 11.7  Registration; Regulatory Approval.  Following approval of the Plan by the stockholders of the Company as provided in Section 1.2 of the Plan, the Board, in its sole discretion, may determine to file with the Securities and Exchange Commission and keep continuously effective, a Registration Statement on Form S-8 with respect to shares of Common Stock subject to Awards hereunder. Notwithstanding anything contained in this Plan to the contrary, the Company shall have no obligation to issue shares of Common Stock under this Plan prior to the obtaining of any approval from, or satisfaction of any waiting period or other condition imposed by, any governmental agency which the Board shall, in its sole discretion, determine to be necessary or advisable.

Section 11.8  Right to Continued Employment.  Participation in the Plan shall not give any Eligible Employee any right to remain in the employ of the Company, any Subsidiary, or any Affiliated Entity. The Company or, in the case of employment with a Subsidiary or an Affiliated Entity, the Subsidiary or Affiliated Entity reserves the right to terminate any Eligible Employee at any time. Further, the adoption of this Plan shall not be deemed to give any Eligible Employee or any other individual any right to be selected as a Participant or to be granted an Award.

Section 11.9  Reliance on Reports.  Each member of the Board and each member of the Board shall be fully justified in relying or acting in good faith upon any report made by the independent public accountants of the Company and its Subsidiaries and upon any other information furnished in connection with the Plan by any person or persons other than himself or herself. In no event shall any person who is or shall have been a member of the Board be liable for any determination made or other action taken or any omission to act in reliance upon any such report or information or for any action taken, including the furnishing of information, or failure to act, if in good faith.

Section 11.10  Construction.  Masculine pronouns and other words of masculine gender shall refer to both men and women. The titles and headings of the sections in the Plan are for the convenience of reference only, and in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.

Section 11.11  Governing Law.  The Plan shall be governed by and construed in accordance with the laws of the State of Delaware except as superseded by applicable Federal law.

Section 11.12  Other Laws.  The Board may refuse to issue or transfer any shares of Common Stock or other consideration under an Award if, acting in its sole discretion, it determines that the issuance or transfer of such shares or such other consideration might violate any applicable law or regulation or entitle the Company to recover the same under Section 16(b) of the Exchange Act, and any payment tendered to the Company by a Participant, other holder or beneficiary in connection with the exercise of such Award shall be promptly refunded to the relevant Participant, holder or beneficiary.

Section 11.13  No Trust or Fund Created.  Neither the Plan nor an Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company and a Participant or any other person. To the extent that a Participant acquires the right to receive payments from the Company pursuant to an Award, such right shall be no greater than the right of any general unsecured creditor of the Company.

Section 11.14  Conformance to Section 409A of the Code.  To the extent that the Committee determines that any Award granted under the Plan is subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code. To the extent applicable, the Plan and Award Agreements shall be interpreted in accordance with Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder, including without limitation any such regulations or other guidance that may be issued after the Effective Date. Notwithstanding any provision of the Plan to the

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contrary, in the event that the Committee determines that any Award may be subject to Section 409A of the Code and related Department of Treasury guidance, the Committee may adopt such amendments to the Plan and the applicable Award Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Committee determines are necessary or appropriate to (i) exempt the Award from Section 409A of the Code or (ii) comply with the requirements of Section 409A of the Code and related Department of Treasury guidance.

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EX-10.3

Exhibit 10.3

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is entered into as of the 12th day of June, 2008, by and among Vantage Drilling Company, a Cayman Islands exempted company (the “Company”) and F3 Capital (“F3 Capital”).

WHEREAS, the Company, Offshore Group Investment Limited, Vantage Energy Services, Inc. and F3 Capital have previously entered into a certain Share Purchase Agreement, dated as of August 30, 2007, as amended (the “Purchase Agreement”), pursuant to which the Company will receive, in exchange for cash and units, all of the shares of common stock of Offshore Group Investments Limited, an entity incorporated under the laws of the Cayman Islands and a wholly owned subsidiary of F3 Capital; and

WHEREAS, the Company and F3 Capital desire to enter into this Agreement to provide F3 Capital with certain rights related to the registration of (i) shares of Common Stock; (ii) Warrants; and (iii) shares of Common Stock underlying Warrants that F3 Capital will acquire as a result of the Purchase Agreement and the transactions contemplated thereby.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 1.  DEFINITIONS.  The following capitalized terms used herein have the following meanings:

“Agreement” means this Agreement, as amended, restated, supplemented, or otherwise modified from time to time.

“Commission” means the Securities and Exchange Commission, or any other federal agency then administering the Securities Act or the Exchange Act.

“Common Stock” means the common stock, par value $0.001 per share, of the Company.

“Company” is defined in the preamble to this Agreement.

“Demand Registration” is defined in Section 2.1.1.

“Demanding Holder” is defined in Section 2.1.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder, all as the same shall be in effect at the time.

“Form S-3” is defined in Section 2.3.

“Holder” or “Holders” means F3 Capital or any of its affiliates to the extent any of them are permitted to hold Registrable Securities, other than those purchasing Registrable Securities in a market transaction.

“Indemnified Party” is defined in Section 4.3.

“Indemnifying Party” is defined in Section 4.3.

“Majority in interest” of Registrable Securities means a majority of the shares of Common Stock and shares of Common Stock underlying the Warrants included in the Registrable Securities.

“Maximum Number of Shares” is defined in Section 2.1.4.

“Notices” is defined in Section 6.3.

“Piggy-Back Registration” is defined in Section 2.2.1.

“Register,” “Registered” and “Registration” mean a registration effected by preparing and filing a registration statement or similar document in compliance with the requirements of the Securities Act,

and the applicable rules and regulations promulgated thereunder, and such registration statement becoming effective.

“Registrable Securities” mean all of (i) the shares of Common Stock; (ii) the Warrants; and (iii) the shares of Common Stock issuable upon exercise of the Warrants, held by F3 Capital as a result of the transactions contemplated by the Purchase Agreement. Registrable Securities shall also be deemed to include any warrants, shares of capital stock or other securities of the Company issued as a dividend or other distribution with respect to or in exchange for or in replacement of such Registrable Securities. As to any particular Registrable Securities, such securities shall cease to be Registrable Securities when: (a) a Registration Statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been sold, transferred, disposed of or exchanged in accordance with such Registration Statement; (b) such securities shall have been otherwise transferred, new certificates for them not bearing a legend restricting further transfer shall have been delivered by the Company and subsequent public distribution of them shall not require registration under the Securities Act; (c) such securities shall have ceased to be outstanding, or (d) the Commission makes a definitive determination to the Company that the Registrable Securities may be sold or transferred under Rule 144(k).

“Registration Statement” means a registration statement filed by the Company with the Commission in compliance with the Securities Act and the rules and regulations promulgated thereunder (other than a registration statement on Form S-4 or Form S-8, or their successors, or any registration statement covering only securities proposed to be issued in exchange for securities or assets of another entity).

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder, all as the same shall be in effect at the time.

“F3 Capital” is defined in the preamble to the Agreement.

“F3 Capital Indemnified Party” is defined in Section 4.1.

“Underwriter” means a securities dealer who purchases any Registrable Securities as principal in an underwritten offering and not as part of such dealer’s market-making activities.

“Warrants” mean the Warrants to purchase an aggregated 25,000,000 shares of Common Stock issued by the Company to F3 Capital pursuant to the Purchase Agreement dated of even date herewith between the Company, F3 Capital, Vantage Energy Services, Inc. and Offshore Group Investments Limited.

2.  REGISTRATION RIGHTS.

2.1  Demand Registration.

2.1.1  Request for Registration.Commencing on the date hereof, F3 Capital and its affiliates who collectively own a Majority-in-interest of the Registrable Securities, may make a written demand for registration under the Securities Act of all or part of their Registrable Securities (a “Demand Registration”). Any demand for a Demand Registration shall specify the number and type of Registrable Securities proposed to be sold and the intended method(s) of distribution thereof. The Company will notify the Holders of Registrable Securities of the demand, and each Holder of Registrable Securities who wishes to include all or a portion of such Holder’s Registrable Securities in the Demand Registration (each such Holder including shares of Registrable Securities in such registration, a “Demanding Holder”) shall so notify the Company within fifteen (15) days after the date of the notice from the Company. Upon any such request, the Demanding Holders shall be entitled to have their Registrable Securities included in the Demand Registration, subject to Section 2.1.4 and the provisions set forth in

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Section 3.1.1. The Company shall not be obligated to effect more than an aggregate of two (2) Demand Registrations under this Section 2.1.1 in respect of Registrable Securities.

2.1.2  Effective Registration.  A registration will not count as a Demand Registration until the Registration Statement filed with the Commission with respect to such Demand Registration has been declared effective by the Commission and the Company has complied with all of its obligations under this Agreement with respect thereto; provided, however, that if, after such Registration Statement has been declared effective, the offering of Registrable Securities pursuant to a Demand Registration is interfered with by any stop order or injunction of the Commission or any other governmental agency or court, the Registration Statement with respect to such Demand Registration will be deemed not to have been declared effective, unless and until, (i) such stop order or injunction is removed, rescinded or otherwise terminated, and (ii) a Majority-in-interest of the Demanding Holders thereafter elect to continue the offering; provided, further, that the Company shall not be obligated to file a second Registration Statement until a Registration Statement that has been filed is deemed an effective Demand Registration hereunder or is terminated.

2.1.3  Underwritten Offering.  If a Majority-in-interest of the Demanding Holders so elect and such Holders so advise the Company as part of their written demand for a Demand Registration, the offering of such Registrable Securities pursuant to such Demand Registration shall be in the form of an underwritten offering. In such event, the right of any Holder to include its Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Demanding Holders proposing to distribute their securities through such underwriting shall enter into an underwriting agreement in customary form with the Underwriter or Underwriters selected for such underwriting by a Majority-in-interest of the Holders initiating the Demand Registration.

2.1.4  Reduction of Offering.  If the managing Underwriter or Underwriters for a Demand Registration that is to be an underwritten offering advises the Company and the Demanding Holders in writing that the dollar amount or number of Registrable Securities which the Demanding Holders desire to sell, taken together with all other shares of Common Stock or other securities which the Company desires to sell and the shares of Common Stock, if any, as to which registration has been requested pursuant to written contractual piggy-back registration rights held by other security holders of the Company who desire to sell, exceeds the maximum dollar amount or maximum number of securities that can be sold in such offering without adversely affecting the proposed offering price, the timing, the distribution method, or the probability of success of such offering (such maximum dollar amount or maximum number of securities, as applicable, the “Maximum Number of Shares”), then the Company shall include in such registration: (i) first, the Registrable Securities as to which Demand Registration has been requested by the Demanding Holders (pro rata in accordance with the number of shares that each such Person has requested be included in such registration, regardless of the number of shares held by each such Person (such proportion is referred to herein as “Pro Rata”)) that can be sold without exceeding the Maximum Number of Shares; (ii) second, to the extent that the Maximum Number of Shares has not been reached under the foregoing clause (i), the shares of Common Stock or other securities that the Company desires to sell that can be sold without exceeding the Maximum Number of Shares; and (iii) third, to the extent that the Maximum Number of Shares has not been reached under the foregoing clauses (i) and (ii), the shares of Common Stock or other securities for the account of other persons that the Company is obligated to register pursuant to written contractual arrangements with such persons and that can be sold without exceeding the Maximum Number of Shares.

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2.1.5  Withdrawal.  If a Majority-in-interest of the Demanding Holders disapprove of the terms of any underwriting or are not entitled to include all of their Registrable Securities in any offering, such Majority-in-interest of the Demanding Holders may elect to withdraw from such offering by giving written notice to the Company and the Underwriter or Underwriters of their request to withdraw prior to the effectiveness of the Registration Statement filed with the Commission with respect to such Demand Registration. If the Majority-in-interest of the Demanding Holders withdraws from a proposed offering relating to a Demand Registration, then such registration shall not count as a Demand Registration provided for in Section 2.1.

2.1.6  Expiration of Demand Rights.  The Holders shall have the right to demand a Demand Registration during the period commencing on or after the date hereof and expiring on a date which is five (5) years from the date hereof.

2.2  Piggy-Back Registration.

2.2.1  Piggy-Back Rights.  If at any time on or after the date hereof the Company proposes to file a Registration Statement under the Securities Act with respect to an offering of equity securities, or securities or other obligations exercisable or exchangeable for, or convertible into, equity securities, by the Company for its own account or for security holders of the Company for their accounts (or by the Company and by security holders of the Company including, without limitation, pursuant to Section 2.1), other than a Registration Statement: (i) filed in connection with any employee stock option or other benefit plan on Form S-8; (ii) for an exchange offer or offering of securities solely to the Company’s existing security holders; (iii) for an offering of debt that is convertible into equity securities of the Company; (iv) for a dividend reinvestment plan; or (v) in connection with an acquisition or merger on Form S-4, then the Company shall (x) give written notice of such proposed filing to the Holders of Registrable Securities as soon as practicable but in no event less than ten (10) days before the anticipated filing date, which notice shall describe the amount and type of securities to be included in such offering, the intended method(s) of distribution, and the name of the proposed managing Underwriter or Underwriters, if any, of the offering, and (y) offer to the Holders of Registrable Securities in such notice the opportunity to register the sale of such number of shares of Registrable Securities as such Holders may request in writing within five (5) days following receipt of such notice (a “Piggy-Back Registration”). The Company shall cause such Registrable Securities to be included in such registration and shall use its commercially reasonable efforts to cause the managing Underwriter or Underwriters of a proposed underwritten offering to permit the Registrable Securities requested to be included in a Piggy-Back Registration on the same terms and conditions as any similar securities of the Company and to permit the sale or other disposition of such Registrable Securities in accordance with the intended method(s) of distribution thereof. The Holders of Registrable Securities proposing to distribute their securities through a Piggy-Back Registration that involves an Underwriter or Underwriters shall enter into an underwriting agreement in customary form with the Underwriter or Underwriters selected for such Piggy-Back Registration. The Holders shall have the right to request no more than five (5) Piggy-Back Registrations during the period commencing on or after the date hereof and expiring on a date which is five (5) years from the date hereof.

2.2.2  Reduction of Offering.  If the managing Underwriter or Underwriters for a Piggy-Back Registration that is to be an underwritten offering advises the Company and the Holders of Registrable Securities in writing that the dollar amount or number of shares of Common Stock which the Company desires to sell, taken together with shares of Common Stock, if any, as to which registration has been demanded pursuant to written contractual arrangements with persons other than the Holders of Registrable Securities hereunder, the Registrable Securities as to which registration has been requested under this Section 2.2, and

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the shares of Common Stock, if any, as to which registration has been requested pursuant to the written contractual piggy-back registration rights of other stockholders of the Company, exceeds the Maximum Number of Shares, then the Company shall include in any such registration, if the registration is undertaken for the Company’s account: (A) first, the shares of Common Stock or other securities that the Company desires to sell that can be sold without exceeding the Maximum Number of Shares; (B) second, to the extent that the Maximum Number of Shares has not been reached under the foregoing clause (A), the shares of Common Stock or other securities, if any, comprised of Registrable Securities, as to which registration has been requested pursuant to the applicable written contractual piggy-back registration rights of such security Holders, Pro Rata, that can be sold without exceeding the Maximum Number of Shares; and (C) third, to the extent that the Maximum Number of shares has not been reached under the foregoing clauses (A) and (B), the shares of Common Stock or other securities for the account of other persons that the Company is obligated to register pursuant to written contractual piggy-back registration rights with such persons and that can be sold without exceeding the Maximum Number of Shares.

2.2.3  Withdrawal.  Any Holder of Registrable Securities may elect to withdraw such Holder’s request for inclusion of Registrable Securities in any Piggy-Back Registration by giving written notice to the Company of such request to withdraw prior to the effectiveness of the Registration Statement. The Company (whether on its own determination or as the result of a withdrawal by persons making a demand pursuant to written contractual obligations) may also, at its option, withdraw a registration statement at any time prior to the effectiveness of the Registration Statement. Notwithstanding any such withdrawal, the Company shall pay all expenses incurred by the Holders of Registrable Securities in connection with such Piggy-Back Registration as provided in Section 3.3.

2.3  Registrations on Form S-3.  The Holders of Registrable Securities may at any time and from time to time, request in writing that the Company register the resale of any or all of such Registrable Securities on Form S-3 or any similar short-form registration which may be available for use by the Company at such time (“Form S-3”). Upon receipt of such written request, the Company will promptly give written notice of the proposed registration to all other Holders of Registrable Securities, and, as soon as practicable thereafter, effect the registration of all or such portion of such Holder’s or Holders’ Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities or other securities of the Company, if any, of any other Holder or Holders joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to effect any such registration pursuant to this Section 2.3 if (i) Form S-3 is not available for such offering, or (ii) the Holders of the Registrable Securities, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) at any aggregate price to the public of less than $1,000,000. Registrations effected pursuant to this Section 2.3 shall be counted as Demand Registrations effected pursuant to Section 2.1.

3.  REGISTRATION PROCEDURES.

3.1  Filings; Information.  Whenever the Company is required to effect the registration of any Registrable Securities pursuant to Section 2, the Company shall use its commercially reasonable efforts to effect the registration and sale of such Registrable Securities in accordance with the intended method(s) of distribution thereof as expeditiously as practicable, and otherwise in compliance with this Section 3.

3.1.1  Timeframe for Filing Registration Statement.The Company shall, as expeditiously as possible and in any event within sixty (60) days after receipt of a request for a Demand

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Registration pursuant to Section 2.1, prepare and file with the Commission a Registration Statement on any form for which the Company then qualifies or which counsel for the Company shall deem appropriate and which form shall be available for the sale of all Registrable Securities to be registered thereunder in accordance with the intended method(s) of distribution thereof, and shall use its commercially reasonable efforts to cause such Registration Statement to become and remain effective for the period required by Section 3.1.3; provided, however, that the Company shall have the right to defer any Demand Registration for (i) up to forty-five (45) days, and any Piggy-Back Registration for such period as may be applicable to deferment of any Demand Registration to which such Piggy-Back Registration relates, in each case if the Company shall furnish to the Holders a certificate signed by the Chief Executive Officer or Vice Chairman of the Company stating that, in the good faith judgment of the Board of Directors of the Company, it would be materially detrimental to the Company and its stockholders for such Registration Statement to be effected at such time, or (ii) for up to ninety (90) days if a demand has been made within the timeframe commencing on a date which is thirty (30) days prior to the end of the Company’s fiscal year end and ending on a date which is forty-five (45) days after the end of the Company’s fiscal year end; provided further, however, that the Company shall not have the right to exercise the right to delay any filing more than once in any 365-day period in respect of a Demand Registration hereunder.

3.1.2  Copies.  The Company shall, prior to filing a Registration Statement or prospectus, or any amendment or supplement thereto, furnish without charge to the Holders of Registrable Securities included in such registration, and such Holders’ legal counsel, copies of such Registration Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in each case including all exhibits thereto and documents incorporated by reference therein), the prospectus included in such Registration Statement (including each preliminary prospectus), and such other documents as the Holders of Registrable Securities included in such registration or legal counsel for any such Holders may request in order to facilitate the disposition of the Registrable Securities owned by such Holders.

3.1.3  Amendments and Supplements.  The Company shall prepare and file with the Commission such amendments, including post-effective amendments, and supplements to such Registration Statement and the prospectus used in connection therewith as may be necessary to keep such Registration Statement effective and in compliance with the provisions of the Securities Act until all Registrable Securities and other securities covered by such Registration Statement have been disposed of in accordance with the intended method(s) of distribution set forth in such Registration Statement (which period shall not exceed the sum of one hundred eighty (180) days plus any period during which any such disposition is interfered with by any stop order or injunction of the Commission or any governmental agency or court) or such securities have been withdrawn.

3.1.4  Notification.  After the filing of a Registration Statement, the Company shall promptly, and in no event more than five (5) business days after such filing, notify the Holders of Registrable Securities included in such Registration Statement of such filing, and shall further notify such Holders promptly and confirm such advice in writing in all events within three (3) business days of the occurrence of any of the following: (i) when such Registration Statement becomes effective; (ii) when any post-effective amendment to such Registration Statement becomes effective; (iii) the issuance or threatened issuance by the Commission of any stop order (and the Company shall take all actions required to prevent the entry of such stop order or to remove it if entered); and (iv) any request by the Commission for any amendment or supplement to such Registration Statement or any prospectus relating thereto

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or for additional information or of the occurrence of an event requiring the preparation of a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of the securities covered by such Registration Statement, such prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and promptly make available to the Holders of Registrable Securities included in such Registration Statement any such supplement or amendment; except that before filing with the Commission a Registration Statement or prospectus or any amendment or supplement thereto, including documents incorporated by reference, the Company shall furnish to the Holders of Registrable Securities included in such Registration Statement and to the legal counsel for any such Holders, copies of all such documents proposed to be filed sufficiently in advance of filing to provide such Holders and legal counsel with a reasonable opportunity to review such documents and comment thereon, and the Company shall not file any Registration Statement or prospectus or amendment or supplement thereto, including documents incorporated by reference, to which such Holders or their legal counsel shall object.

3.1.5  State Securities Laws Compliance.  The Company shall use its commercially reasonable efforts to (i) register or qualify the Registrable Securities covered by the Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as the Holders of Registrable Securities included in such Registration Statement (in light of their intended plan of distribution) may request and (ii) take such action necessary to cause such Registrable Securities covered by the Registration Statement to be registered with or approved by such other Governmental Authorities as may be necessary by virtue of the business and operations of the Company and do any and all other acts and things that may be necessary or advisable to enable the Holders of Registrable Securities included in such Registration Statement to consummate the disposition of such Registrable Securities in such jurisdictions; provided, however, that the Company shall not be required to qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this paragraph or subject itself to taxation in any such jurisdiction.

3.1.6  Agreements for Disposition.  The Company shall enter into customary agreements (including, if applicable, an underwriting agreement in customary form) and take such other actions as are reasonably required in order to expedite or facilitate the disposition of such Registrable Securities. The representations, warranties and covenants of the Company in any underwriting agreement which are made to or for the benefit of any Underwriters, to the extent applicable, shall also be made to and for the benefit of the Holders of Registrable Securities included in such registration statement. No Holder of Registrable Securities included in such registration statement shall be required to make any representations or warranties in the underwriting agreement except, if applicable, with respect to such Holder’s organization, good standing, authority, title to Registrable Securities, lack of conflict of such sale with such Holder’s material agreements and organizational documents, and with respect to written information relating to such Holder that such Holder has furnished in writing expressly for inclusion in such Registration Statement. Holders of Registrable Securities shall agree to such covenants and indemnification and contribution obligations for selling stockholders as are customarily contained in agreements of that type. Further, such holders shall cooperate fully in the preparation of the registration statement and other documents relating to any offering in which they include securities pursuant to Section 2 hereof; provided, however, that such cooperation shall be limited to furnishing to the Company such information regarding itself, the Registrable Securities held by such holder and the intended method of disposition of such securities as shall be reasonably required to effect the registration of the Registrable Securities.

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3.1.7  Cooperation.  The principal executive officer of the Company, the principal financial officer of the Company, the principal accounting officer of the Company and all other officers and members of the management of the Company shall cooperate fully in any offering of Registrable Securities hereunder, which cooperation shall include, without limitation, the preparation of the Registration Statement with respect to such offering and all other offering materials and related documents, and participation in meetings with Underwriters, attorneys, accountants and potential investors.

3.1.8  Records.  The Company shall make available for inspection by the Holders of Registrable Securities included in such Registration Statement, any Underwriter participating in any disposition pursuant to such registration statement and any attorney, accountant or other professional retained by any Holder of Registrable Securities included in such Registration Statement or any Underwriter, all financial and other records, pertinent corporate documents and properties of the Company, as shall be necessary to enable them to exercise their due diligence responsibility, and cause the Company’s officers, directors and employees to supply all information requested by any of them in connection with such Registration Statement.

3.1.9  Opinions and Comfort Letters.  The Company shall furnish to each Holder of Registrable Securities included in any Registration Statement a signed counterpart, addressed to such Holder, of (i) any opinion of counsel to the Company delivered to any Underwriter and (ii) any comfort letter from the Company’s independent public accountants delivered to any Underwriter. In the event no legal opinion is delivered to any Underwriter, the Company shall furnish to each Holder of Registrable Securities included in such Registration Statement, at any time that such Holder elects to use a prospectus, an opinion of counsel to the Company to the effect that the Registration Statement containing such prospectus has been declared effective and that no stop order is in effect.

3.1.10  Earnings Statement.  The Company shall comply with all applicable rules and regulations of the Commission and the Securities Act, and make available to its stockholders, as soon as practicable, an earnings statement covering a period of twelve (12) months, beginning within three (3) months after the effective date of the registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder.

3.1.11  Listing.  The Company shall use its commercially reasonable efforts to cause all Registrable Securities included in any registration to be listed on such exchanges or otherwise designated for trading in the same manner as similar securities issued by the Company are then listed or designated or, if no such similar securities are then listed or designated, in a manner satisfactory to F3 Capital and its affiliates who collectively own a majority of the Registrable Securities included in such registration.

3.2  Obligation to Suspend Distribution.  Upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3.1.4(iv), or, in the case of a resale registration on Form S-3 pursuant to Section 2.3 hereof, upon any suspension by the Company, pursuant to a written insider trading compliance program adopted by the Company’s Board of Directors, of the ability of all “insiders” covered by such program to transact in the Company’s securities because of the existence of material non-public information, each Holder of Registrable Securities included in any registration shall immediately discontinue disposition of such Registrable Securities pursuant to the Registration Statement covering such Registrable Securities until such Holder receives the supplemented or amended prospectus contemplated by Section 3.1.4(iv) or the restriction on the ability of “insiders” to transact in the Company’s securities is removed, as applicable, and, if so directed by the Company, each such Holder will deliver to the Company all

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copies, other than permanent file copies then in such Holder’s possession, of the most recent prospectus covering such Registrable Securities at the time of receipt of such notice.

3.3  Registration Expenses.  The Company shall bear all costs and expenses incurred in connection with any Demand Registration pursuant to Section 2.1, any Piggy-Back Registration pursuant to Section 2.2, and any registration on Form S-3 effected pursuant to Section 2.3, and all expenses incurred in performing or complying with its other obligations under this Agreement, whether or not the Registration Statement becomes effective, including, without limitation: (i) all registration and filing fees; (ii) fees and expenses of compliance with securities or “blue sky” laws (including fees and disbursements of counsel in connection with blue sky qualifications of the Registrable Securities); (iii) printing expenses; (iv) the fees and expenses incurred in connection with the listing of the Registrable Securities as required by Section 3.1.11; (v) National Association of Securities Dealers, Inc. filing fees; (vi) fees and disbursements of counsel for the Company and fees and expenses for independent certified public accountants retained by the Company (including the expenses or costs associated with the delivery of any opinions or comfort letters requested pursuant to Section 3.1.9); (vii) the fees and expenses of any special experts retained by the Company in connection with such registration; (viii) in the case of a Demand Registration or a registration on Form S-3, the fees and expenses of any legal counsel selected by F3 Capital and its affiliates; and (ix) in the case of a Piggy-Back Registration, the fees and expenses of one legal counsel selected by all of the holders of the securities included in the Registration Statement who are participating on a piggy-back basis. The Company shall have no obligation to pay any underwriting discounts or selling commissions attributable to the Registrable Securities being sold by the Holders thereof, which underwriting discounts or selling commissions shall be borne by such Holders. Additionally, in an underwritten offering, all selling stockholders and the Company shall bear the expenses of the underwriter pro rata in proportion to the respective amount of shares each is selling in such offering.

3.4  Information.  The Holders of Registrable Securities shall provide such information as may reasonably be requested by the Company, or the managing Underwriter, if any, in connection with the preparation of any Registration Statement, including amendments and supplements thereto, in order to effect the registration of any Registrable Securities under the Securities Act pursuant to Section 2 and in connection with the Company’s obligation to comply with federal and applicable state securities laws. In the event that a Holder does not provide any requested information to the Company at least 48 hours prior to the filing of any Registration Statement, then the Company may remove such declining Holder from the Registration Statement without penalty or being deemed in violation of this Agreement.

4.  INDEMNIFICATION AND CONTRIBUTION.

4.1  Indemnification by the Company.  The Company agrees to indemnify and hold harmless F3 Capital, and each of its respective officers, employees, affiliates, directors, partners, members, attorneys and agents, and each person, if any, who controls F3 Capital (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) (each, a “F3 Capital Indemnified Party”), from and against any expenses, losses, judgments, claims, damages or liabilities, whether joint or several, arising out of or based upon any untrue statement (or allegedly untrue statement) of a material fact contained in any Registration Statement under which the sale of such Registrable Securities was registered under the Securities Act, any preliminary prospectus, final prospectus or summary prospectus contained in the Registration Statement, or any amendment or supplement to such Registration Statement, or arising out of or based upon any omission (or alleged omission) to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or any violation by the Company of the Securities Act or any rule or regulation promulgated thereunder applicable to the Company and relating to action or inaction required of the Company in connection with any such registration; and the

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Company shall promptly reimburse the F3 Capital Indemnified Party for any legal and any other expenses reasonably incurred by such F3 Capital Indemnified Party in connection with investigating and defending any such expense, loss, judgment, claim, damage, liability or action; provided, however, that the Company will not be liable to F3 Capital in any such case to the extent that any such expense, loss, claim, damage or liability arises out of or is based upon any untrue statement or allegedly untrue statement or omission or alleged omission made in such Registration Statement, preliminary prospectus, final prospectus, or summary prospectus, or any such amendment or supplement, in reliance upon and in conformity with information furnished to the Company, in writing, by F3 Capital. The Company also shall indemnify any Underwriter of the Registrable Securities, their officers, affiliates, directors, partners, members and agents and each person who controls such Underwriter on substantially the same basis as that of the indemnification provided above in this Section 4.1.

4.2  Indemnification by Holders of Registrable Securities.  Each selling Holder of Registrable Securities will, in the event that any registration is being effected under the Securities Act pursuant to this Agreement of any Registrable Securities held by such selling Holder, indemnify and hold harmless the Company, each of its directors and officers and each underwriter (if any), and each other selling Holder and each other person, if any, who controls another selling Holder or such underwriter within the meaning of the Securities Act, against any losses, claims, judgments, damages or liabilities, whether joint or several, insofar as such losses, claims, judgments, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or allegedly untrue statement of a material fact contained in any Registration Statement under which the sale of such Registrable Securities was registered under the Securities Act, any preliminary prospectus, final prospectus or summary prospectus contained in the Registration Statement, or any amendment or supplement to the Registration Statement, or arise out of or are based upon any omission or the alleged omission to state a material fact required to be stated therein or necessary to make the statement therein not misleading, if the statement or omission was made in reliance upon and in conformity with information furnished in writing to the Company by such selling Holder, and shall reimburse the Company, its directors and officers, and each other selling Holder or controlling person for any legal or other expenses reasonably incurred by any of them in connection with investigation or defending any such loss, claim, damage, liability or action. Each selling Holder’s indemnification obligations hereunder shall be several and not joint and shall be limited to the amount of any net proceeds actually received by such selling Holder.

4.3  Conduct of Indemnification Proceedings.  Promptly after receipt by any person of any notice of any loss, claim, damage or liability or any action in respect of which indemnity may be sought pursuant to Section 4.1 or 4.2, such person (the “Indemnified Party”) shall, if a claim in respect thereof is to be made against any other person for indemnification hereunder, notify such other person (the “Indemnifying Party”) in writing of the loss, claim, judgment, damage, liability or action; provided, however, that the failure by the Indemnified Party to notify the Indemnifying Party shall not relieve the Indemnifying Party from any liability which the Indemnifying Party may have to such Indemnified Party hereunder, except and solely to the extent the Indemnifying Party is actually prejudiced by such failure. If the Indemnified Party is seeking indemnification with respect to any claim or action brought against the Indemnified Party, then the Indemnifying Party shall be entitled to participate in such claim or action, and, to the extent that it wishes, jointly with all other Indemnifying Parties, to assume control of the defense thereof with counsel satisfactory to the Indemnified Party. After notice from the Indemnifying Party to the Indemnified Party of its election to assume control of the defense of such claim or action, the Indemnifying Party shall not be liable to the Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that in any action in which both the Indemnified Party and the Indemnifying Party are named as defendants, the Indemnified Party shall have the right to employ

10

separate counsel (but no more than one such separate counsel) to represent the Indemnified Party and its controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought by the Indemnified Party against the Indemnifying Party, with the fees and expenses of such counsel to be paid by such Indemnifying Party if, based upon the written opinion of counsel of such Indemnified Party, representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, consent to entry of judgment or effect any settlement of any claim or pending or threatened proceeding in respect of which the Indemnified Party is or could have been a party and indemnity could have been sought hereunder by such Indemnified Party, unless such judgment or settlement includes an unconditional release of such Indemnified Party from all liability arising out of such claim or proceeding.

4.4  Contribution.

4.4.1  If the indemnification provided for in the foregoing Sections 4.1, 4.2 and 4.3 is unavailable to any Indemnified Party in respect of any loss, claim, damage, liability or action referred to herein, then each such Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage, liability or action in such proportion as is appropriate to reflect the relative fault of the Indemnified Parties and the Indemnifying Parties in connection with the actions or omissions which resulted in such loss, claim, damage, liability or action, as well as any other relevant equitable considerations. The relative fault of any Indemnified Party and any Indemnifying Party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by such Indemnified Party or such Indemnifying Party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

4.4.2  The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 4.4 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding Section

4.4.3  The amount paid or payable by an Indemnified Party as a result of any loss, claim, damage, liability or action referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 4.4, no Holder of Registrable Securities shall be required to contribute any amount in excess of the dollar amount of the net proceeds (after payment of any underwriting fees, discounts, commissions or taxes) actually received by such Holder from the sale of Registrable Securities which gave rise to such contribution obligation. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

5.  UNDERWRITING AND DISTRIBUTION.

5.1  Rule 144.  The Company covenants that it shall file any reports required to be filed by it under the Securities Act and the Exchange Act and shall take such further action as the Holders of Registrable Securities may reasonably request, all to the extent required from time to time to enable such Holders to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 under the Securities Act, as such

11

Rules may be amended from time to time, or any similar Rule or regulation hereafter adopted by the Commission.

6.  MISCELLANEOUS.

6.1  Other Registration Rights.  Except with respect to those securities issued in exchange for securities issued in connection with Vantage Energy Services, Inc.’s initial public offering in May 2007, or as otherwise disclosed in the Company’s IPO prospectus, the Company represents and warrants that no person, other than a Holder of the Registrable Securities, has any right to require the Company to register any shares of the Company’s capital stock for sale or to include shares of the Company’s capital stock in any registration filed by the Company for the sale of shares of capital stock for its own account or for the account of any other person.

6.2  Assignment; No Third Party Beneficiaries.  This Agreement and the rights, duties and obligations of the Company and F3 Capital hereunder may not be assigned or delegated by either the Company or F3 Capital in whole or in part. This Agreement and the provisions hereof shall be binding upon and shall inure to the benefit of each of the parties and their successors. This Agreement is not intended to confer any rights or benefits on any persons that are not party hereto other than as expressly set forth in Article 4 and this Section 6.2.

6.3  Notices.  All notices, demands, requests, consents, approvals or other communications (collectively, “Notices”) required or permitted to be given hereunder or which are given with respect to this Agreement shall be in writing and shall be personally served, delivered by reputable air courier service with charges prepaid, or transmitted by hand delivery, telegram, telex or facsimile, addressed as set forth below, or to such other address as such party shall have specified most recently by written notice. Notice shall be deemed given on the date of service or transmission if personally served or transmitted by telegram, telex or facsimile; provided, that if such service or transmission is not on a business day or is after normal business hours, then such notice shall be deemed given on the next business day. Notice otherwise sent as provided herein shall be deemed given on the next business day following timely delivery of such notice to a reputable air courier service with an order for next-day delivery.

To the Company:

Vantage Drilling Company
c/o Vantage Energy Services, Inc.
777 Post Oak Blvd., Suite 610
Houston, Texas 77056
Attention: Chief Executive Officer
Fax: (713) 781-9655

with a copy to:

Porter & Hedges LLP

1000 Main Street, 36th Floor

Houston, Texas 77002

Attn: Bryan Brown, Esq.

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And

Maples and Calder
c/o M&C Corporate Services Limited
PO Box 309GT, Ugland House
South Church Street, George Town
Grand Cayman, Cayman Islands
Attn: Matthew Gardner, Esq.

To F3 Capital:
8^th No 126 Jianguo North Road
Taipei 104, Taiwan

6.4  Severability.  This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible that is valid and enforceable.

6.5  Counterparts.  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument.

6.6  Entire Agreement.  This Agreement (including all agreements entered into pursuant hereto and all certificates and instruments delivered pursuant hereto and thereto) constitute the entire agreement of the parties with respect to the subject matter hereof and supersede all prior and contemporaneous agreements, representations, understandings, negotiations and discussions between the parties, whether oral or written.

6.7  Modifications and Amendments.  No amendment, modification or termination of this Agreement shall be binding upon any party unless executed in writing by such party.

6.8  Titles and Headings.  Titles and headings of sections of this Agreement are for convenience only and shall not affect the construction of any provision of this Agreement.

6.9  Waivers and Extensions.  Any party to this Agreement may waive any right, breach or default which such party has the right to waive, provided that such waiver will not be effective against the waiving party unless it is in writing, is signed by such party, and specifically refers to this Agreement. Waivers may be made in advance or after the right waived has arisen or the breach or default waived has occurred. Any waiver may be conditional. No waiver of any breach of any agreement or provision herein contained shall be deemed a waiver of any preceding or succeeding breach thereof nor of any other agreement or provision herein contained. No waiver or extension of time for performance of any obligations or acts shall be deemed a waiver or extension of the time for performance of any other obligations or acts.

6.10  Remedies Cumulative.  In the event that the Company fails to observe or perform any covenant or agreement to be observed or performed under this Agreement, F3 Capital may proceed to protect and enforce its rights by suit in equity or action at law, whether for specific performance of any term contained in this Agreement or for an injunction against the breach of any such term or in aid of the exercise of any power granted in this Agreement or to enforce any other legal or equitable right, or to take any one or more of such actions, without being required to post a bond. None of the rights, powers or remedies conferred under this Agreement shall be mutually exclusive, and each such right, power or remedy shall be cumulative and in addition to

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any other right, power or remedy, whether conferred by this Agreement or now or hereafter available at law, in equity, by statute or otherwise.

6.11  Governing Law.  This Agreement shall be governed by, interpreted under, and construed in accordance with the internal laws of the State of New York applicable to agreements made and to be performed within the State of New York, without giving effect to any choice-of-law provisions thereof that would compel the application of the substantive laws of any other jurisdiction.

6.12  Waiver of Trial by Jury.  Each party hereby irrevocably and unconditionally waives the right to a trial by jury in any action, suit, counterclaim or other proceeding (whether based on contract, tort or otherwise) arising out of, connected with or relating to this Agreement, the transactions contemplated hereby, or the actions of F3 Capital in the negotiation, administration, performance or enforcement hereof.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement to be executed and delivered by their duly authorized representatives as of the date first written above.

VANTAGE DRILLING COMPANY
/s/ Paul A. Bragg
By:		Paul A. Bragg
Title:		Director, Chief Executive Officer
F3 CAPITAL
/s/ Hsin Chi Su
By:	Hsin Chi Su
Title:			President

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EX-10.4

Exhibit 10.4

EMPLOYMENT AND NON-COMPETITION AGREEMENT

BETWEEN

VANTAGE DRILLING COMPANY

AND

PAUL A. BRAGG

DATED JUNE 12, 2008

TABLE OF CONTENTS

			Page
1.	EMPLOYMENT TERM AND DUTIES		1
	1.1	Term of Employment	1
	1.2	Duties as Employee of the Company	1
	1.3	Place of Performance	2
	1.4	Fiduciary Duty	2
	1.5	Compliance	2
2.	COMPENSATION AND RELATED MATTERS		2
	2.1	Base Salary	2
	2.2	Bonus Payments	2
	2.3	Expenses	3
	2.4	Automobiles	3
	2.5	Business, Travel and Entertainment Expenses	3
	2.6	Vacation	3
	2.7	Welfare, Pension and Incentive Benefit Plans	3
	2.8	Dues	3
	2.9	Other Benefits	3
	2.10	Perquisites	4
	2.11	Proration	4
	2.12	Intentionally Left Blank	4
	2.13	Additional Payments	4
		(a)     Excise Tax; Gross-Up Payment	4
		(b)     Accounting Firm Determinations	5
		(c)     Notification of Claims	5
		(d)     Refund	6
		(e)     Insurance	7
3.	TERMINATION		7
	3.1	Definitions	7
	3.1.2	Notice to Cure	7
	3.2	Termination Date	10
	3.3	Constructive Termination Without Cause	10
	3.4	Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits	10
	3.5	Base Salary	11
	3.6	Stock Awards	11
	3.7	Other Benefits	11
	3.8	Expenses	11
	3.9	Mitigation	11
	3.10	Maximum Payments	11
	3.11	Net After-Tax Benefit	12
	3.12	Termination In Event of Death: Benefits	12
	3.13	Termination In Event of Disability: Benefits	12

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	3.14	Voluntary Termination by Employee and Termination for Cause: Benefits	13
	3.15	Termination Procedure	13
		A.     Notice of Termination	13
		B.     Date of Termination	13
		C.     Mitigation	13
4.	DIRECTOR POSITIONS		14
5.	NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY		14
	5.1	Non-Competition During Employment	14
	5.2	Conflicts of Interest	14
	5.3	Non-Competition After Termination	14
	5.4	Non-Solicitation of Customers	15
	5.5	Non-Solicitation of Employees	15
	5.6	Confidential Information	15
	5.7	Original Material	16
	5.8	Return of Documents, Equipment, Etc.	16
	5.9	Reaffirm Obligations	16
	5.10	Prior Disclosure	16
	5.11	Confidential Information of Prior Companies	17
	5.12	Rights Upon Breach	17
		(a)     Specific Performance	17
		(b)     Accounting	17
	5.13	Remedies For Violation of Non-Competition or Confidentiality Provisions	17
	5.14	Severability of Covenants	18
	5.15	Court Review	18
	5.16	Enforceability in Jurisdictions	18
	5.17	Extension of Post-Employment Restrictions	18
6.	INDEMNIFICATION		18
	6.1	General	18
	6.2	Expenses	19
	6.3	Enforcement	19
	6.4	Partial Indemnification	19
	6.5	Advances of Expenses	19
	6.6	Notice of Claim	19
	6.7	Defense of Claim	19
	6.8	Non-exclusivity	20
7.	LEGAL FEES AND EXPENSES		20
8.	BREACH		20
9.	RIGHT TO ENTER AGREEMENT		21

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10.	COMPLIANCE WITH SECTION 409A	21
	10.2     Certain Definitions	21
	10.3     Delay in Payments	21
	10.4     Reformation	22
11.	ENFORCEABILITY	22
12.	SURVIVABILITY	22
13.	ASSIGNMENT	22
14.	BINDING AGREEMENT	22
15.	NOTICES	22
16.	WAIVER	23
17.	SEVERABILITY	23
18.	ARBITRATION	23
19.	ENTIRE AGREEMENT	24
20.	SECTION HEADINGS	24
21.	MODIFICATION OF AGREEMENT	24
22.	UNDERSTANDING OF AGREEMENT	24
23.	GOVERNING LAW	24
24.	WITHHOLDING	24
25.	JURISDICTION AND VENUE	25
26.	NO PRESUMPTION AGAINST INTEREST	25

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EMPLOYMENT AND NON-COMPETITION AGREEMENT

This Employment and Non-Competition Agreement (“Agreement”) is entered into as of the 12^th day of June, 2008 (the “Effective Date”), between Vantage Drilling Company, a Cayman islands corporation (“Company”), and Paul A. Bragg (“Employee” or “Executive”).

RECITALS:

WHEREAS, Executive is to be employed as an integral part of its management who participates in the decision-making process relative to short and long-term planning and policy for the Company, will serve on the Company’s Executive Management Committee;

WHEREAS, the Company desires to obtain assurances from the Executive that he will devote his best efforts to the Company and will not enter into competition with the Company, solicit its customers, or solicit employees of the Company after termination of his employment;

WHEREAS, Executive will serve as a key employee with special and unique talents and skills of peculiar benefit and importance to the Company; and

WHEREAS, Executive is desirous of committing himself to serve on the terms herein provided; and

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below, the Parties agree as follows:

1.                                                                                                                                   
60;  EMPLOYMENT TERM AND DUTIES

1.1          Term of Employment.  Effective as of the Effective Date, the Company hereby agrees to employ Executive as its Chief Executive Officer, and Executive hereby agrees to accept such employment, on the terms and conditions set forth herein, for the period commencing on the Effective Date and expiring as of June 12, 2010 (the “Basic Term”) (unless sooner terminated as hereinafter set forth). The Basic Term shall be automatically extended for successive terms of one (1) year commencing on each Anniversary of the Effective Date thereafter (each such date being a “Renewal Date”), so as to terminate one (1) year from such Renewal Date, unless and until at least ninety (90) days prior to a Renewal Date either party hereto gives written notice to the other that the Term should not be further extended after the next Renewal Date (a “Notice of Non-Renewal”), in which event the Termination Date shall not be less than one (1) year following receipt of the Notice of Non-Renewal.

1.2          Duties as Employee of the Company.  Executive shall, subject to the supervision of the Board, have general executive management and control of the Company in the ordinary course of its business with all such powers with respect to such management and control as may be reasonably incident to such responsibilities.  Executive shall devote his normal and regular business time, attention and skill to diligently attending to the business of the Company during the Basic Term. During the Basic Term, Executive shall not directly or indirectly render any services of a business, commercial, or professional nature to any other person, firm, corporation,

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or organization, whether for compensation or otherwise, without the prior written consent of the Chairman of the Board.  Notwithstanding the foregoing, it shall not be a violation of the Agreement for Executive to (i) serve on corporate, civic or charitable boards or committees, (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, and (iii) manage personal investments so long as such activities do not materially interfere or conflict with the performance of his duties to the Company hereunder.  The conduct of such activity shall not be deemed to materially interfere or conflict with Executive’s performance of his duties until Executive has been notified in writing thereof and given a reasonable period in which to cure the same.

1.3          Place of Performance.  During the Employment Period, the Company shall maintain its executive offices in Houston, Texas, and the Executive shall not be required to relocate to any other location.  During the Employment Period, the Company shall provide the Executive with an office and staff and other such facilities and services as shall be suitable to Executive’s position and adequate for the performance of Executive’s duties hereunder.

1.4          Fiduciary Duty.  Executive acknowledges and agrees that he owes a fiduciary duty to the Company, and further agrees to make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not act for his own benefit concerning the subject matter of his fiduciary relationship.

1.5          Compliance.  Executive agrees that he will not take any action which he knows would not comply with United States law as applicable to Executive’s employment, including, but without limitation to the Foreign Corrupt Practices Act.

2.COMPENSATION AND RELATED MATTERS

2.1          Base Salary.  Executive shall receive a base salary (the “Base Salary”) paid by the Company at the annual rate of Five Hundred Thousand ($500,000.00) U.S., payable not less frequently than in substantially equal monthly installments, with the opportunity to increases, from time to time thereafter which are in accordance with the Company’s regular executive compensation practices.

2.2          Bonus Payments.  For each full fiscal year of the Company that begins and ends during the Employment Period, and for the portion of the fiscal year of the Company that begins in 2008 (“Fiscal Year 2008”), the Executive shall be eligible to earn an annual cash bonus in such amount as shall be determined by the Compensation Committee of the Board (the “Compensation Committee”) (the “Annual Bonus”) based on the achievement by the Company of performance goals established by the Compensation Committee for each such fiscal year (or portion of Fiscal Year 2008).  The Compensation Committee shall establish objective criteria to be used to determine the extent to which performance goals have been satisfied.  For purposes of this Agreement, net earnings per share is defined as the Company’s consolidated net earnings per share as reported in the Company’s Annual Report on Form 10-K.  The Executive’s annual bonus potential target shall not be less than one hundred percent (100%) of Base Salary.

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2.3          Expenses.  During the Basic Term, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by him in accordance with the policies and procedures established by the Compensation Committee for the Company’s senior executive officers in performing services hereunder, provided that Executive properly accounts for such expenses in accordance with the Company’s policies and procedures.

2.4          Automobiles.  The Company shall provide the Executive with an automobile allowance of $750.00 per month consistent with the practices of the Company.

2.5          Business, Travel and Entertainment Expenses.  The Company shall promptly reimburse the Executive for all business, travel and entertainment expenses consistent with the Executive’s titles and the practices of the Company.

2.6          Vacation.  The Executive shall be entitled to four (4) weeks of vacation per year. Vacation not taken during the applicable fiscal year (but not in excess of two (2) weeks) shall be carried over to the next following fiscal year.

2.7          Welfare, Pension and Incentive Benefit Plans.  During the Employment Period, the Executive (and his eligible spouse and dependents) shall be entitled to participate in all the welfare benefit plans and programs maintained by the Company from time-to-time for the benefit of its senior executives including, without limitation, all medical, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs. In addition, during the Employment Period, the Executive shall be eligible to participate in all pension, retirement, savings and other employee benefit plans and programs maintained from time-to-time by the Company for the benefit of its senior executives, other than any annual cash incentive plan.

2.8          Dues.  During the Employment Period, the Company shall pay or promptly reimburse the Executive for annual dues for membership in professional organizations relevant to Executive’s job responsibilities.

2.9          Other Benefits.  Executive shall be entitled to participate in or receive benefits under any compensatory employee benefit plan or other arrangement made available by the Company now or in the future to its senior executive officers and key management employees, subject to and on a basis consistent with the terms, conditions, and overall administration of such plan or arrangement. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the Base Salary payable to Executive pursuant to Section 2.1 of this Agreement.  The Company shall not make any changes in any employee benefit plans or other arrangements in effect on the date hereof or subsequently in effect in which Executive currently or in the future participates (including, without limitation, each pension and retirement plan, supplemental pension and retirement plan, savings and profit sharing plan, stock or unit ownership plan, stock or unit purchase plan, stock or unit option plan, life insurance plan, medical insurance plan, disability plan, dental plan, health and accident plan, or any other similar plan or arrangement) that would adversely affect Executive’s rights or benefits thereunder, unless such change occurs pursuant to a program applicable to substantially all executives of the Company and does not result in a proportionately greater reduction in the

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rights of or benefits to Executive as compared with any other executive of the Company.  The Company shall recommend that Executive receive an annual award of restricted stock and/or stock options in Vantage Drilling Company in the amount of approximately Two Million One Hundred Thousand Dollars ($2,100,000) based on market studies of industry executives, but Executive recognizes and agrees that future years could vary significantly as market conditions and industry compensation trends change.  If there is a Change of Control (as herein defined), any Stock Awards (as herein defined) which Executive has received under this Agreement shall vest immediately.

2.10        Perquisites.  Executive shall be entitled to receive the perquisites and fringe benefits appertaining to an executive officer of the Company, in accordance with any practice established by the Compensation Committee.  In addition to the other benefits provided in this Agreement, Executive and his family shall be entitled to receive medical insurance as that may be provided under the Company’s group program, as such group program may be changed from time-to-time in the future, and Executive shall be entitled to continue to be covered by such group program or, if not permitted under the terms of the group program, then the Company shall provide Executive with a medical insurance policy providing substantially similar benefits as to the group program, for the period ending on the date of the later to die of Executive or, if Executive is married on the date of his death, Executive’s spouse.  Executive shall be entitled to receive the medical benefits defined herein at no cost to the Executive.  However, Executive’s rights pursuant to this subsection shall be void if Executive is terminated for Cause or if Executive voluntarily terminates his employment.

2.11        Proration.  Any payments or benefits payable to Executive hereunder in respect of any calendar year during which Executive is employed by the Company for less than the entire year, unless otherwise provided in the applicable plan or arrangement, shall be prorated in accordance with the number of days in such calendar year during which he is so employed.

2.12        Intentionally left blank.

2.13        Additional Payments.

(a)           Excise Tax; Gross-Up Payment.  Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by the Company to or for 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 under this Section (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (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, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise

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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.

(b)           Accounting Firm Determinations.  All determinations required to be made under this Section 2.13, including whether and when 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 a reputable accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (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. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting a Change of Control of the Company, the Executive shall appoint another reputable 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 Section, shall be paid by the Company to the Executive within five (5) days after 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 should have been made (an “Underpayment”), consistent with the calculations required to be made hereunder.  In the event that the Company exhausts its remedies pursuant to this Section and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment and any applicable penalty that has occurred and the amount of any such Underpayment and any applicable penalty shall be promptly paid by the Company to or for the benefit of the Executive.

(c)           Notification of Claims.  The Executive shall notify the Company in writing of any claims by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as practicable but no later than thirty (30) days after the Executive actually receives notice 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 thirty (30) day period following the date on which the Executive 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:

1.             give the Company any information reasonably requested by the Company relating to such claim;

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2.             take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;

3.             cooperate with the Company in good faith in order to effectively contest such claim; and

4.             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 on the foregoing provisions of this Section, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego 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 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 further provided 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)           Refund.  If, after the receipt by the Executive of an amount advanced by the Company pursuant to this Section, 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 this Section) 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 this Section, 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

6

thirty (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.

(e)           Insurance.  The Company may, from time to time, apply for and take out, in its own name and at its own expense, naming itself or one or more of its affiliates as the designated beneficiary (which it may change from time to time), policies for life, health, accident, disability or other insurance upon the Executive in any amount or amounts that it may deem necessary or appropriate to protect its interest.  The Executive agrees to aid the Company in procuring such insurance by submitting to medical examinations and by completing, executing and delivering such applications and other instruments in writing as may reasonably be required by an insurance company or companies to which any application or applications for insurance may be made by or for the Company.

3.TERMINATION

3.1          Definitions.

A.              “Cause” shall mean:

(i)              Material dishonesty which is not the result of an inadvertent or innocent mistake of Executive with respect to the Company or any of its subsidiaries;

(ii)           Willful misfeasance or nonfeasance of duty by Executive intended to injure or having the effect of injuring in some material fashion the reputation, business, or business relationships of the Company or any of its subsidiaries or any of their respective officers, directors, or employees;

(iii)          Material violation by Executive of any material term of this Agreement;

(iv)          Conviction of Executive of any felony, any crime involving moral turpitude or any crime other than a vehicular offense which could reflect in some material fashion unfavorably upon the Company or any of its subsidiaries; or

(v)           Violation of Sections 1.3 or 1.4 above.

3.1.2       Notice to Cure.  Executive may not be terminated for Cause unless and until there has been delivered to Executive written notice from the Board supplying the particulars of Executive’s acts or omissions that the Board believes constitute Cause, a reasonable period of time (not less than 30 days) has been given to Executive after such notice to either cure the same or to meet with the Board, with his attorney if so desired by

7

Executive, and following which the Board by action of not less than two-thirds of its members furnishes to Executive a written resolution specifying in detail its findings that Executive has been terminated for Cause as of the date set forth in the notice to Executive.

3.1.3         A.          For purposes of this Agreement, no act or failure to act by the Executive shall be considered “willful” if such act is done by the Executive in the good faith belief that such act is or was to be beneficial to the Company or one or more of its businesses, or such failure to act is due to the Executive’s good faith belief that such action would be materially harmful to the Company or one of its businesses.  Cause shall not exist unless and until the Company has delivered to the Executive a copy of a resolution duly adopted by a majority of the Board (excluding the Executive for purposes of determining such majority) at a meeting of the Board called and held for such purpose after reasonable (but in no event less than thirty days’) notice to the Executive and an opportunity for the Executive, together with his counsel, to be heard before the Board, finding that in the good faith opinion of the Board that “Cause” exists, and specifying the particulars thereof in detail.  This Section shall not prevent the Executive from challenging in an arbitration proceeding the Board’s determination that Cause exists or that the Executive has failed to cure any act (or failure to act) that purportedly formed the basis for the Board’s determination.

B.            A “Change of Control” shall be deemed to have occurred if:

(i)            A reverse merger involving the Company or the Parent in which the Company or the Parent, as the case may be, is the surviving corporation but the shares of common stock of the Company or the Parent (the “Common Stock”) outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise, and the shareholders of the Parent immediately prior to the completion of such transaction hold, directly or indirectly, less than fifty percent (50%) of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act, or comparable successor rules) of the surviving entity or, if more than one entity survives the transaction, the controlling entity; or

(ii)           Any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of 50% or more of the Company’s then outstanding voting common stock; or

(iii)          At any time during the period of three (3) consecutive years (not including any period prior to the date hereof), individuals who at the beginning of such period constituted the Board (and any new

8

director whose election by the Board or whose nomination for election by the Company’s shareholders were approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority thereof; or

(iv)          The shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation (a) in which a majority of the directors of the surviving entity were directors of the Company prior to such consolidation or merger, and (b) which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being changed into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation; or

(v)           The shareholders approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

C.            A “Disability” shall mean the absence of Executive from Executive’s duties with the Company on a full-time basis for 180 consecutive days, or 180 days in a 365-day period, as a result of incapacity due to mental or physical illness which results in the Executive being unable to perform the essential functions of his position, with or without reasonable accommodation.

D.            A “Good Reason” shall mean any of the following (without Executive’s express written consent):

(i)            Following a Change of Control, a material alteration in the nature or status of Executive’s title, duties or responsibilities, or the assignment of duties or responsibilities inconsistent with Executive’s status, title, duties and responsibilities;

(ii)           A failure by the Company to continue in effect any employee benefit plan in which Executive was participating, or the taking of any action by the Company that would adversely affect Executive’s participation in, or materially reduce Executive’s benefits under, any such employee benefit plan, unless such failure or such taking of any action adversely affects the senior members of corporate management of the Company generally to the same extent;

(iii)          A relocation of the Company’s principal offices, or Executive’s relocation to any place other than the principal executive

9

offices, exceeding a distance of fifty (50) miles from the Company’s current executive office located in Houston, Texas, except for reasonably required travel by Executive on the Company’s business;

(iv)          Any material breach by the Company of any provision of this Agreement;

(v)           Any failure by the Company to obtain the assumption and performance of this Agreement by any successor (by merger, consolidation, or otherwise) or assign of the Company; or

(vi)          The Company provides written notice of non-renewal to the Executive.

However, Good Reason shall exist with respect to an above specified matter only if such matter is not corrected by the Company within thirty (30) days of its receipt of written notice of such matter from Executive, and in no event shall a termination by Executive occurring more than ninety (90) days following the date of the event described above be a termination for Good reason due to such event.

3.2          Termination Date.  “Termination Date” shall mean the date Executive is terminated for any reason pursuant to this Agreement.

3.3          Constructive Termination Without Cause.  “Constructive Termination Without Cause” shall mean: Notwithstanding any other provision of this Agreement, the Executive’s employment under this Agreement may be terminated during the Term by the Executive, which shall be deemed to be constructive termination by the Company without Cause, if one of the following events shall occur without the written consent of the Executive: (i) a reduction in the Executive’s fixed salary; (ii) the failure of the Company to continue to provide the Executive with office space, related facilities and secretarial assistance that are commensurate with the Executive’s responsibilities to and position with the Company; (iii) the notification by the Company of the Company’s intention not to observe or perform one or more of the obligations of the Company under this Agreement; or (iv) the failure by the Company to indemnify, pay or reimburse the Executive at the time and under the circumstances required by this Agreement.  Any such termination pursuant to this Section shall be made by the Executive providing written notice to the Company specifying the event relied upon for such termination and given within sixty (60) days after such event.  Any constructive termination pursuant to this Section shall be effective sixty (60) days after the date the Executive has given the Company such written notice setting forth the grounds for such termination with specificity; provided, however, that the Executive shall not be entitled to terminate this Agreement in respect of any of the grounds set forth above if within sixty (60) days after such notice the action constituting such ground for termination has been cured and is no longer continuing.

3.4          Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits.

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3.5          Base Salary and Annual Bonus.  For a period of thirty six (36) months after the Termination Date, Base Salary and Annual Bonus (as such terms are defined herein) at the rate, and payable quarterly unless such termination is by the Company without Cause, in which even such amount of Base Salary and Annual Bonus shall be paid in a lump sum within ten (10) days of the Termination Event.

3.6          Stock Awards.  If there is a Change of Control or if there is a Termination Event, any stock or stock option award issued pursuant to the 2007 Long Term Incentive Compensation Plan (“Stock Awards”) which Executive has received under this Agreement shall vest immediately and, if there is a Termination Event, all such Stock Awards shall be exercisable from the date of such Termination Event for the remainder of their term.

3.7          Other Benefits.  To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other amounts or benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy or practice, or contract or agreement of the Company and its affiliated companies for the period of time equal to the remainder of the Basic Term (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).  Without limiting the preceding sentence and without limiting any other provision of this Agreement, through the remaining Basic Term, but under no condition less than one (1) year, the Company, at its sole expense, shall continue to provide (through its own plan and/or individual policies) Executive (and Executive’s dependents) with health benefits no less favorable than the group health plan benefits provided during such period to any senior executive officer of the Company or any affiliated company (to the extent any such coverage or benefits are taxable to Executive by reason of being provided under a self-insured health plan of the Company or an affiliate, the Company shall make Executive “whole” for the same on an after-tax basis).  In any event, the Other Benefits provided for pursuant to this Section shall be secondary to any benefits and coverage Executive (or his dependents) receive from another employer.

3.8          Expenses.  All accrued compensation and unreimbursed expenses through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the Termination Date; and

3.9          Mitigation.  Executive shall be free to accept other employment during such period, subject to the limitation as set forth in Section 5 of this Agreement and there shall be no offset of any employment compensation earned by Executive in such other employment during such period against payments due Executive under this Section 3, and there shall be no offset in any compensation received from such other employment against the Base Salary set forth above.

3.10        Maximum Payments.  It is the objective of this Agreement to maximize the Executive’s Net After-Tax Benefit (as defined herein) if payments or benefits provided under this Section are subject to excise tax under Section 4999 of the Code.  Therefore, in the event it is determined that any payment or benefit 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 Section or otherwise, including, by example and not by way of limitation, acceleration by the Company or otherwise of the date of vesting or payment or rate of payment under any plan, program or

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arrangement of the Company, would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties 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”), the Company shall first make a calculation under which such payments or benefits provided to the Executive under this Agreement are reduced to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code (the “4999 Limit”).  The Company shall then compare (x) the Executive’s Net After-Tax Benefit assuming application of  the 4999 Limit with (y) the Executive’s Net After-Tax Benefit without the application of the 4999 Limit and the Executive shall be entitled to the greater of (x) or (y).

3.11        Net After-Tax Benefit.  “Net After-Tax Benefit” shall mean the sum of (i) all payments and benefits which the Executive receives or is then entitled to receive from the Company, less (ii) the amount of federal income taxes payable with respect to the payments and benefits described in (i) above calculated at the maximum marginal income tax rate for each year in which such payments and benefits shall be paid to the Executive (based upon the rate for such year as set forth in the Code at the time of the first payment of the foregoing), less (iii) the amount of excise taxes imposed with respect to the payments and benefits described in (i) above by Section 4999 of the Code.  The determination of whether a payment or benefit constitutes an excess parachute payment shall be made by tax counsel selected by the Company and reasonably acceptable to the Executive. The costs of obtaining this determination shall be borne by the Company.

3.12        Termination In Event of Death: Benefits.  If Executive’s employment is terminated by reason of Executive’s death during the Basic Term, this Agreement shall terminate, except as provided herein, without further obligation to Executive’s legal representatives under this Agreement, other than for payment of all accrued compensation, unreimbursed expenses, the timely payment or provision of Other Benefits through the date of death, one (1) year’s Base Salary, and such cash or stock bonus as Executive would otherwise have been awarded in year if Executive’s death had not occurred.  Such amounts shall be paid to Executive’s estate or beneficiary, as applicable, in a lump sum in cash within ninety (90) days after the date of death.  With respect to the provision of Other Benefits, the term Other Benefits as used in this Section shall include, without limitation, and Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company to the estates and beneficiaries of other executive level employees of the Company under such plans, programs, practices, and policies relating to death benefits, if any, as in effect with respect to other executives and their beneficiaries at any time during the 120-day period immediately preceding the date of death.  Additionally, all Stock Awards shall be vested immediately and shall be exercisable for the greater of one year after the date of such vesting or the remaining term of such option.

3.13        Termination In Event of Disability: Benefits.  If Executive’s employment is terminated by reason of Executive’s Disability during the Basic Term, this Agreement shall continue in full force for a period of one (1) year following such Disability and if such Disability occurs on or after June 1 of any year Executive shall be entitled to the same cash or stock bonus in such year that Executive would have been awarded if such Disability had not occurred. In

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addition, all outstanding Stock Awards shall vest immediately upon such termination due to Disability.

3.14        Voluntary Termination by Employee and Termination for Cause: Benefits. Executive may terminate his employment with the Company without Good Reason by giving written notice of his intent and stating an effective Termination Date at least ninety (90) days after the date of such notice; provided, however, that the Company may accelerate such effective date by paying Executive through the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date.  Upon such a termination by Executive, except as provided in Section 5, or upon termination for Cause by the Company, this Agreement shall terminate and the Company shall pay to Executive all accrued compensation, unreimbursed expenses and the Other Benefits through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the date of termination.  In addition, all unvested stock options shall terminate and all vested options will terminate one hundred twenty (120) days after the Termination Date.

3.15        Termination Procedure.

A.            Notice of Termination.  Any termination of the Executive’s employment by the Company or by the Executive during the Employment Period (other than pursuant to Section 3.5) shall be communicated by written Notice of Termination to the other party. For purposes of this Agreement, a “Notice of Termination” shall mean a notice indicating the specific termination provision in this Agreement relied upon and setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under that provision.

B.            Date of Termination.  “Date of Termination” shall mean (i) if the Executive’s employment is terminated by his death, the date of his death, (ii) if the Executive’s employment is terminated pursuant to Section 3.13, thirty (30) days after the date of receipt of the Notice of Termination (provided that the Executive does not return to the substantial performance of his duties on a full-time basis during such thirty (30) day period), and (iii) if the Executive’s employment is terminated for any other reason, the date on which a Notice of Termination is given or any later date (within thirty (30) days after the giving of such notice) set forth in such Notice of Termination.

C.            Mitigation.  The Executive shall not be required to mitigate damages with respect to the termination of his employment under this Agreement by seeking other employment or otherwise, and there shall be no offset against amounts due the Executive under this Agreement on account of subsequent employment except as specifically provided in this Agreement. Additionally, amounts owed to the Executive under this Agreement shall not be offset by any claims the Company may have against the Executive, and the Company’s obligation to make the payments provided for in this Agreement, and otherwise to perform its obligations hereunder, shall not be affected by any other circumstances, including, without limitation, any counterclaim, recoupment, defense or other right which the Company may have against the Executive or others.

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4.DIRECTOR POSITIONS

Executive agrees that upon termination of employment, for any reason, at the request of the Chairman of the Board, he will immediately tender his resignation from any and all Board positions held with the Company and/or any of its subsidiaries and affiliates. If Executive remains as a director, at the election of the Board, after such termination, Executive shall be compensated as an outside director.

5.NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY

The Company shall provide Executive with its trade secrets, goodwill, and confidential information of Company and contact with the Company’s customers and potential customers.  Executive also recognizes and agrees that the benefit of not being employed at-will, is provided in consideration for, among other things, the agreements contained in this Section, as well as the Stock Awards granted to Executive pursuant to this Agreement.  Executive agrees that the business of the Company is highly competitive and that the trade secrets, goodwill, and confidential information of the Company is of primary importance to the success of the Company.  In consideration of all of the foregoing, and in recognition of these conditions, and specifically for being provided trade secrets, goodwill, and confidential information, Executive agrees as follows:

5.1          Non-Competition During Employment.  Executive agrees during the Basic Term he will not compete with the Company by engaging in the conception, design, development, production, marketing, or servicing of any product or service that is substantially similar to the products or services which the Company provides, and that he will not work for, in any capacity, assist, or became affiliated with as an owner, partner, etc., either directly or indirectly, any individual or business which offer or performs services, or offers or provides products substantially similar to the services and products provided by Company.

5.2          Conflicts of Interest.  Executive agrees that during the Basic Term, he will not engage, either directly or indirectly, in any activity (a “Conflict of Interest”) which might adversely affect the Company or its affiliates, including ownership of a material interest in any supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business or accepting any material payment, service, loan, gift, trip, entertainment, or other favor from a supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business, and that Executive will promptly inform the Chairman of the Company as to each offer received by Executive to engage in any such activity. Executive further agrees to disclose to the Company any other facts of which Executive becomes aware which might in Executive’s good faith judgment reasonably be expected to involve or give rise to a Conflict of Interest or potential Conflict of Interest.

5.3          Non-Competition After Termination.  In further consideration of the Company providing Employee confidential information, executive agrees that Executive shall not, at any time during the period of one (1) year after termination within the geographic area as

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defined by this Section 5 that the Company has sold products or services or formulated a plan to sell products or services into a market during the last twelve (12) months of Executive’s employ, engage in or contribute Executive’s knowledge to any work which is competitive with or similar to a product, process, apparatus, services, or development on which Executive worked or with respect to which Executive had access to Confidential Information while employed by the Company.  It is understood that the geographical area set forth in this covenant is divisible so that if this clause is invalid or unenforceable in an included geographic area, that area is severable and the clause remains in effect for the remaining included geographic areas in which the clause is valid. For purposes of this Section 5.3, the geographic area shall apply to the territory or country where the Company conducts operations.

5.4          Non-Solicitation of Customers.  In further consideration of the Company providing Employees confidential information, Executive further agrees that for a period of one (1) year after termination, he will not solicit or accept any business from any customer or client or prospective customer or client with whom Executive dealt or solicited while employed by Company during the last twelve (12) a months of his employment.

5.5          Non-Solicitation of Employees.  Executive agrees that for the duration of the Basic Term, and for a period of one (1) year after the termination of the Basic Term, he will not either directly or indirectly, on his own behalf or on behalf of others, solicit, attempt to hire, or hire any person employed by Company to work for Executive or for another entity, firm, corporation, or individual.

5.6          Confidential Information.  Executive further agrees that he will not, except as the Company may otherwise consent or direct in writing, reveal or disclose, sell, use, lecture upon, publish or otherwise disclose to any third party any Confidential Information or proprietary information of the Company, or authorize anyone else to do these things at any time either during or subsequent to his employment with the Company.  This Section shall continue in full force and effect after termination of Executive’s employment and after the termination of this Agreement.  Executive shall continue to be obligated under the Confidential Information Section of this Agreement not to use or to disclose Confidential Information of the Company so long as it shall not be publicly available.  Executive’s obligations under this Section with respect to any specific Confidential Information and proprietary information shall cease when that specific portion of the Confidential Information and proprietary information becomes publicly known, in its entirety and without combining portions of such information obtained separately.  It is understood that such Confidential Information and proprietary information of the Company include matters that Executive conceives or develops, as well as matters Executive learns from other employees of Company. Confidential Information is defined to include information: (1) disclosed to or known by the Executive as a consequence of or through his employment with the Company; (2) not generally known outside the Company; and (3) which relates to any aspect of the Company or its business, finances, operation plans, budgets, research, or strategic development. “Confidential Information” includes, but is not limited to the Company’s trade secrets, proprietary information, financial documents, long range plans, customer lists, employer compensation, marketing strategy, data bases, costing data, computer software developed by the Company, investments made by the Company, and any information provided to the Company by a third party under restrictions against disclosure or use by the Company or others.

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5.7          Original Material.  The Executive agrees that any inventions, discoveries, improvements, ideas, concepts or original works of authorship relating directly to the Company Business, including without limitation information of a technical or business nature such as ideas, discoveries, designs, inventions, improvements, trade secrets, know-how, manufacturing processes, product formulae, design specifications, writings and other works of authorship, computer programs, financial figures, marketing plans, customer lists and data, business plans or methods and the like, which relate in any manner to the actual or anticipated business or the actual or anticipated areas of research and development of the Company and its divisions and affiliates, whether or not protectable by patent or copyright, that have been originated, developed or reduced to practice by the Executive alone or jointly with others during the Executive’s employment with the Company shall be the property of and belong exclusively to the Company. The Executive shall promptly and fully disclose to the Company the origination or development by the Executive of any such material and shall provide the Company with any information that it may reasonably request about such material.  Either during the subsequent to the Executive’s employment, upon the request and at the expense of the Company or its nominee, and for no remuneration in addition to that due the Executive pursuant to the Executive’s employment by the Company, but at no expense to the Executive, the Executive agrees to execute, acknowledge, and deliver to the Company or its attorneys any and all instruments which, in the judgment of the Company or its attorneys, may be necessary or desirable to secure or maintain for the benefit of the Company adequate patent, copyright, and other property rights in the United States and foreign countries with respect to any such inventions, improvements, ideas, concepts, or original works of authorship embraced within this Agreement.

5.8          Return of Documents, Equipment, Etc.  All writings, records, and other documents and things comprising, containing, describing, discussing, explaining, or evidencing any Confidential Information, and all equipment, components, parts, tools, and the like in Executive’s custody or possession that have been obtained or prepared in the course of Executive’s employment with the Company shall be the exclusive property of the Company, shall not be copied and/or removed from the premises of the Company, except in pursuit of the business of the Company, and shall be delivered to the Company, without Executive retaining any copies, upon notification of the termination of Executive’s employment or at any other time requested by the Company. The Company shall have the right to retain, access, and inspect all property of Executive of any kind in the office, work area, and on the premises of the Company upon termination of Executive’s employment and at any time during employment by the Company upon termination of Executive’s employment and at any time during employment by the Company to ensure compliance with the terms of this Agreement.

5.9          Reaffirm Obligations.  Upon termination of his employment with the Company, Executive, if requested by Company, shall reaffirm in writing Executive’s recognition of the importance of maintaining the confidentiality of the Company’s Confidential Information and proprietary information, and reaffirm any other obligations set forth in this Agreement.

5.10        Prior Disclosure.  Executive represents and warrants that he has not used or disclosed any Confidential Information he may have obtained from Company prior to signing this Agreement, in any way inconsistent with the provisions of this Agreement.

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5.11        Confidential Information of Prior Companies.  Executive will not disclose or use during the period of his employment with the Company any proprietary or Confidential Information or Copyright Works which Executive may have acquired because of employment with an employer other than the Company or acquired from any other third party, whether such information is in Executive’s memory or embodied in a writing or other physical form

5.12        Rights Upon Breach.  If the Executive breaches, any of the provisions contained in Section 5 of this Agreement (the “Restrictive Covenants”), the Company shall have the following rights and remedies, each of which rights and remedies shall be independent of the others and severally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity:

(a)           Specific Performance.  The right and remedy to have the Restrictive Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach of the Restrictive Covenants would cause irreparable injury to the Company and that money damages would not provide an adequate remedy to the Company.

(b)           Accounting.  The right and remedy to require the Executive to account for and pay over to the Company all compensation, profits, monies, accruals, increments or other benefits derived or received by the Executive as the result of any action constituting a breach of the Restrictive Covenants.

5.13        Remedies For Violation of Non-Competition or Confidentiality Provisions. Without limiting the right of the Company to pursue all other legal and equitable rights available to it for violation of any of the obligations and covenants made by Employee herein, it is agreed that:

(a)           the skills, experience and contacts of Employee are of a special, unique, unusual and extraordinary character which give them a peculiar value;

(b)           because of the business of the Company, the restrictions agreed to by Employee as to time and area contained in the Agreement are reasonable; and

(c)           the injury suffered by the Company by a violation of any obligation or covenant in the Agreement resulting from loss of profits created by (i) the competitive use of such skills, experience contacts and otherwise and/or (ii) the use or communication of any information deemed confidential herein will be difficult to calculate in damages in an action at law and cannot fully compensate the Company for any violation of any obligation or covenant in the Agreement, accordingly:

(i)            the Company shall be entitled to injunctive relief to prevent violations thereof and prevent Employee from rendering any services to any person, firm or entity in breach of such obligation or covenant and to prevent Employee from divulging any confidential information; and

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(ii)           compliance with the Agreement is a condition precedent to the Company’s obligation to make payments of any nature to employee, subject to the other provisions hereof.

(d)           employee waives any objection to the enforceability of the restrictive covenants and agrees to be estopped from denying the legality and enforceability of these provisions.

5.14        Severability of Covenants.  The Executive acknowledges and agrees that the Restrictive Covenants are reasonable and valid in duration and geographical scope and in all other respects.  If any court determines that any of the Restrictive Covenants, or any part thereof, is invalid or unenforceable, the remainder of the Restrictive Covenants shall not thereby be affected and shall be given full effect without regard to the invalid portions.

5.15        Court Review.  If any court determines that any of the Restrictive Covenants, or any part thereof is unenforceable because of the duration or geographical scope of or scope of activities restrained by, such provision, such court shall have the power to reduce the duration or scope of such provision, as the case may be, and, in its reduced form, such provision shall then be enforceable.

5.16        Enforceability in Jurisdictions.  The Company and the Executive intend to and hereby confer jurisdiction to enforce the Restrictive Covenants upon the courts of any jurisdiction within the geographical scope of such Restrictive Covenants.  If the courts of any one or more of such jurisdictions hold the Restrictive Covenants unenforceable by reason of the breadth of such scope or otherwise, it is the intention of the Company that such determination not bar or in any way affect the right of the Company to the relief provided above in the courts of any other jurisdiction within the geographical scope of such Restrictive Covenants, as to breaches of such Restrictive Covenants in such other respective jurisdictions, such Restrictive Covenants as they relate to each jurisdiction being, for this purpose, severable into diverse and independent covenants.

5.17        Extension of Post-Employment Restrictions.  In the event Executive breaches Section 5 above, the restrictive time periods contained in those provisions will be extended by the period of time Executive was in violation of such provisions.

6.INDEMNIFICATION

6.1          General.  The Company agrees that if the Executive is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”), by reason of the fact that the Executive is or was a trustee, director or officer of the Company, the Company, or any predecessor to the Company (including any sole proprietorship owned by the Executive) or any of their affiliates or is or was serving at the request of the Company, the Company, any predecessor to the Company (including any sole proprietorship owned by the Executive), or any of their affiliates as a trustee, director, officer, member, employee or agent of another corporation or a partnership, joint

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venture, limited liability company, trust or other enterprise, including, without limitation, service with respect to employee benefit plans, whether or not the basis of such Proceeding is alleged action in an official capacity as a trustee, director, officer, member, employee or agent while serving as a trustee, director, officer, member, employee or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by Texas law, as the same exists or may hereafter be amended, against all Expenses incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to the Executive even if the Executive has ceased to be an officer, director, trustee or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators.

6.2          Expenses.  As used in this Section, the term “Expenses” shall include, without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, and costs, attorneys’ fees, accountants’ fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing a right to indemnification under this Agreement.

6.3          Enforcement.  If a claim or request under this Section 6 is not paid by the Company or on its behalf, within thirty (30) days after a written claim or request has been received by the Company, the Executive may at any time thereafter bring an arbitration claim against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part, the Executive shall be entitled to be paid also the expenses of prosecuting such suit.  All obligations for indemnification hereunder shall be subject to, and paid in accordance with, applicable Texas law.

6.4          Partial Indemnification.  If the Executive is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify the Executive for the portion of such Expenses to which the Executive is entitled.

6.5          Advances of Expenses.  Expenses incurred by the Executive in connection with any Proceeding shall be paid by the Company in advance upon request of the Executive that the Company pay such Expenses, but only in the event that the Executive shall have delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect to which the Executive is not entitled to indemnification and (ii) a statement of his good faith belief that the standard of conduct necessary for indemnification by the Company has been met.

6.6          Notice of Claim.  The Executive shall give to the Company notice of any claim made against him for which indemnification will or could be sought under this Agreement.  In addition, the Executive shall give the Company such information and cooperation as it may reasonably require and as shall be within the Executive’s power and at such times and places as are convenient for the Executive.

6.7          Defense of Claim.  With respect to any Proceeding as to which the Executive notifies the Company of the commencement thereof:

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(a)           The Company will be entitled to participate therein at its own expense.

(b)           Except as otherwise provided below, to the extent that it may wish, the Company will be entitled to assume the defense thereof, with counsel reasonably satisfactory to the Executive, which in the Company’s sole discretion may be regular counsel to the Company and may be counsel to other officers and directors of the Company or any subsidiary.  The Executive also shall have the right to employ his own counsel in such action, suit or proceeding if he reasonably concludes that failure to do so would involve a conflict of interest between the Company and the Executive, and under such circumstances the fees and expenses of such counsel shall be at the expense of the Company.

(c)           The Company shall not be liable to indemnify the Executive under this Agreement for any amounts paid in settlement of any action or claim effected without its written consent.  The Company shall not settle any action or claim in any manner which would impose any penalty that would not be paid directly or indirectly by the Company or limitation on the Executive without the Executive’s written consent. Neither the Company nor the Executive will unreasonably withhold or delay their consent to any proposed settlement.

6.8          Non-exclusivity.  The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Section 6 shall not be exclusive of any other right which the Executive may have or hereafter may acquire under any statute or certificate of incorporation or by-laws of the Company or any subsidiary, agreement, vote of shareholders or disinterested directors or trustees or otherwise.

7.LEGAL FEES AND EXPENSES

If any contest or dispute shall arise between the Company and the Executive regarding any provision of this Agreement, the Company shall reimburse the Executive for all legal fees and expenses reasonably incurred by the Executive in connection with such contest or dispute, but only if the Executive prevails to a substantial extent with respect to the Executive’s claims brought and pursued in connection with such contest or dispute.  Such reimbursement shall be made as soon as practicable following the resolution of such contest or dispute (whether or not appealed) to the extent the Company receives reasonable written evidence of such fees and expenses. The Company shall advance the Executive reasonable attorney’s fees during any arbitration proceedings if brought by the Executive, up to but not to exceed Three Hundred Thousand Dollars ($300,000.00).

8.BREACH

Executive agrees that any breach of restrictive covenants above cannot be remedied solely by money damages, and that in addition to any other remedies Company may have, Company is entitled to obtain injunctive relief against Executive.  Nothing herein, however, shall be construed as limiting Company’s right to pursue any other available remedy at law or in

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equity, including recovery of damages and termination of this Agreement and/or any payments that may be due pursuant to this Agreement.

9.RIGHT TO ENTER AGREEMENT

Executive represents and covenants to Company that he has full power and authority to enter into this Agreement and that the execution of this Agreement will not breach or constitute a default of any other agreement or contract to which he is a party or by which he is bound.

10.COMPLIANCE WITH SECTION 409A

10.1        It is the intention of the Company and the Executive that this Agreement not result in unfavorable tax consequences to the Executive under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).  The Company and the Executive acknowledge that Section 409A of the Code was enacted pursuant to the American Jobs Creation Act of 2004, generally effective with respect to amounts deferred after January 1, 2005, and only limited guidance has been issued by the Internal Revenue Service with respect to the application of Code Section 409A to certain arrangements, such as this Agreement.  The Internal Revenue Service has indicated that it will provide further guidance regarding interpretation and application of Section 409A of the Code during 2005. The Company and the Executive acknowledge further that the full effect of Section 409A of the Code on potential payments pursuant to this Agreement cannot be fully determined at the time that the Company and the Executive are entering into this Agreement. The Company and the Executive agree to work together in good faith in an effort to comply with Section 409A of the Code including, if necessary, amending the Agreement based on further guidance issued by the Internal Revenue Service from time to time, provided that the Company shall not be required to assume any increased economic burden.

10.2        Certain Definitions.  As used in this Agreement, the following terms have the following meanings unless the context otherwise requires:

(a)           “affiliate” means any person controlled by or under common control with the Company but shall not include any stockholder or director of the Company, as such.

(b)           “person” means any individual, corporation, partnership, limited liability company, firm, joint company, association, joint-stock company, trust, unincorporated organization, governmental or regulatory body or other entity.

10.3        Delay in Payments.  Notwithstanding anything to the contrary in this Agreement, (i) if upon the date of Executive’s termination of employment with the Company, Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or any regulations or Treasury guidance promulgated thereunder (the “Code”) and the deferral of any amounts otherwise payable under this Agreement as a result of Executive’s termination of employment is necessary in order to prevent any accelerated or additional tax to Executive under Code Section 409A, then the Company will defer the payment

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of any such amounts hereunder until the date that is six months following the date of Executive’s termination of employment with the Company, at which time any such delayed amounts will be paid to Executive in a single lump sum, with interest from the date otherwise payable at the prime rate as published in The Wall Street Journal on the date of Executive’s termination of employment with the Company, and (ii) if any other payments of money or other benefits due to Executive hereunder could cause the application of an accelerated or additional tax under Code Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Code Section 409A.

10.4        Reformation.  If any provision of this Agreement would cause Executive to occur any additional tax under Code Section 409A, the parties will in good faith attempt to reform the provision in a manner that maintains, to the extent possible, the original intent of the applicable provision without violating the provision of Code Section 409A.

11.ENFORCEABILITY

The agreements contained in the restrictive covenant provisions of this Agreement are independent of the other agreements contained herein.  Accordingly, failure of the Company to comply with any of its obligations outside of such Sections do not excuse Executive from complying with the agreements contained herein.

12.SURVIVABILITY

The agreements contained in Sections 5 shall survive the termination of this Agreement for any reason.

13.ASSIGNMENT

This Agreement cannot be assigned by Executive. The Company may assign this Agreement only to a successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and assets of the Company provided such successor expressly agrees in writing reasonably satisfactory to Executive to assume and 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 and assignment had taken place.  Failure of the Company to obtain such written agreement prior to the effectiveness of any such succession shall be a material breach of this Agreement.

14.BINDING AGREEMENT

Executive understands that his obligations under this Agreement are binding upon Executive’s heirs, successors, personal representatives, and legal representatives.

15.NOTICES

All notices pursuant to this Agreement shall be in writing and sent certified mail, return receipt requested, addressed as set forth below, or by delivering the same in person to such party,

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or by transmission by facsimile to the number set forth below.  Notice deposited in the manner described hereinabove, shall be effective upon deposit.  Notice given in any other manner shall be effective only if and when received:

If to Executive:

Paul A. Bragg

6435 Vanderbilt Street

Houston, Texas 77005

If to Company:

with a copy (which shall not constitute notice) to:

Vantage Drilling Company

777 Post Oak Blvd., Suite 610

Houston, Texas 77056

16.WAIVER

No waiver by either party to this Agreement of any right to enforce any term or condition of this Agreement, or of any breach hereof shall be deemed a waiver of such right in the future or of any other right or remedy available under this Agreement.  The Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3.2 hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

17.SEVERABILITY

If any provision of this Agreement is determined to be void invalid, unenforceable, or against public policy, such provisions shall be deemed severable from the Agreement, and the remaining provisions of the Agreement will remain unaffected and in full force and effect.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

18.ARBITRATION< /h1>

In the event any dispute arises out of Executive’s employment with or by the Company, or separation/termination therefrom, whether as an employee, which cannot be resolved by the Parties to this Agreement, such dispute shall be submitted to final and binding arbitration.  The arbitration shall be conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA”).  If the Parties cannot agree on an arbitrator, a list of seven (7) arbitrators will be requested from AAA, and the arbitrator will be selected using alternate strikes with Executive striking firm. The cost of the

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arbitration will be borne solely by the Company.  Arbitration of such disputes is mandatory and in lieu of any and all civil causes of action and lawsuits either party may have against the other arising out of Executive’s employment with Company, or separation therefrom.  Such arbitration shall be held in Houston, Texas.  This provision shall not, however, preclude the Company from obtaining injunctive relief in any court of competent jurisdiction to enforce Section 5 of this Agreement.

19.ENTIRE AGREEMENT

The terms and provisions contained herein shall constitute the entire agreement between the parties with respect to Executive’s employment with Company during the time period covered by this Agreement. This Agreement replaces and supersedes any and all existing Agreements entered into between Executive and the Company relating generally to the same subject matter, if any, and shall be binding upon Executive’s heirs, executors, administrators, or other legal representatives or assigns.

20.SECTION HEADIN GS

The section headings in this Employment Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation.

21.MODIFICATION OF AGREEMENT

This Agreement may not be changed or modified or released or discharged or abandoned or otherwise terminated, in whole or in part, except by an instrument in writing signed by the Executive and an officer or other authorized executive of Company.

22.UNDERSTANDING OF AGREEMENT

Executive represents and warrants that he has read and understood each and every provision of this Agreement, and Executive understands that he has the right to obtain advice from legal counsel of choice, if necessary and desired, in order to interpret any and all provisions of this Agreement, and that Executive has freely and voluntarily entered into this Agreement.

23.GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

24.WITHHOLDING< /h1>

All payments hereunder shall be subject to any required withholding of Federal, state and local taxes pursuant to any applicable law or regulation.

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25.JURISDICTION AND VENUE

With respect to any litigation regarding this Agreement, Executive agrees to venue in the state or federal courts in Harris County, Texas and agrees to waive and does hereby waive any defenses and/or arguments based upon improper venue and/or lack of personal jurisdiction.  By entering into this Agreement, Executive agrees to personal jurisdiction in the state and federal courts in Harris County, Texas.

26.NO PRESUMPTION AGAINST INTEREST

This Agreement has been negotiated, drafted, edited and reviewed by the respective parties, and therefore, no provision arising directly or indirectly herefrom shall be construed against any party as being drafted by said party.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first above written.

EXECUTIVE

/s/ Paul A. Bragg
Paul A. Bragg
VANTAGE DRILLING COMPANY
By:	/s/ Douglas G. Smith
Name:			Douglas G. Smith
Title:		Chief Financial Officer

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EX-10.5

Exhibit 10.5

EMPLOYMENT AND NON-COMPETITION AGREEMENT

BETWEEN

VANTAGE INTERNATIONAL PAYROLL COMPANY PTE. LTD.

AND

DOUGLAS HALKETT

DATED JUNE 12, 2008

TABLE OF CONTENTS

			Page
1.	EMPLOYMENT TERM AND DUTIES
	1.1	Term of Employment	1
	1.2	Duties as Employee of the Company	1
	1.3	Place of Performance	2
	1.4	Fiduciary Duty	2
	1.5	Compliance	2
2.	COMPENSATION AND RELATED MATTERS
	2.1	Base Salary	2
	2.2	Bonus Payments	2
	2.3	Expenses	2
	2.4	Automobiles	2
	2.5	Business, Travel and Entertainment Expenses	2
	2.6	Vacation	3
	2.7	Welfare, Pension and Incentive Benefit Plans	3
	2.8	Dues	3
	2.9	Other Benefits	3
	2.10	Perquisites	3
	2.11	Proration	4
	2.12	Signing Bonus	4
	2.13	Additional Payments	4
		(a)     Excise Tax; Gross-Up Payment	4
		(b)     Accounting Firm Determinations	4
		(c)     Notification of Claims	5
		(d)     Refund	6
		(e)     Insurance	6
3.	TERMINATION
	3.1	Definitions	6
		3.1.2     Notice to Cure	7
	3.2	Termination Date	9
	3.3	Constructive Termination Without Cause	9
	3.4	Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits	9
	3.5	Base Salary	9
	3.6	Stock Awards	9
	3.7	Other Benefits	9
	3.8	Expenses	10
	3.9	Mitigation	10
	3.10	Maximum Payments	10
	3.11	Net After-Tax Benefit	10
	3.12	Termination In Event of Death: Benefits	10
	3.13	Termination In Event of Disability: Benefits	11

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	3.14	Voluntary Termination by Employee and Termination for Cause: Benefits	11
	3.15	Termination Procedure	11
		A.     Notice of Termination	11
		B.     Date of Termination	11
		C.     Mitigation	11
4.	DIRECTOR POSITIONS
5.	NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY
	5.1	Non-Competition During Employment	12
	5.2	Conflicts of Interest	12
	5.3	Non-Competition After Termination	12
	5.4	Non-Solicitation of Customers	13
	5.5	Non-Solicitation of Employees	13
	5.6	Confidential Information	13
	5.7	Original Material	13
	5.8	Return of Documents, Equipment, Etc.	14
	5.9	Reaffirm Obligations	14
	5.10	Prior Disclosure	14
	5.11	Confidential Information of Prior Companies	14
	5.12	Rights Upon Breach	14
		(a)     Specific Performance	14
		(b)     Accounting	15
	5.13	Remedies For Violation of Non-Competition or Confidentiality Provisions	15
	5.14	Severability of Covenants	16
	5.15	Court Review	16
	5.16	Enforceability in Jurisdictions	16
	5.17	Extension of Post-Employment Restrictions	16
6.	INDEMNIFICATION
	6.1	General	16
	6.2	Expenses	16
	6.3	Enforcement	17
	6.4	Partial Indemnification	17
	6.5	Advances of Expenses	17
	6.6	Notice of Claim	17
	6.7	Defense of Claim	17
	6.8	Non-exclusivity	17
7.	LEGAL FEES AND EXPENSES		18
8.	BREACH		18
9.	RIGHT TO ENTER AGREEMENT		18

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10.	COMPLIANCE WITH SECTION 409A
	10.2	Certain Definitions	18
	10.3	Delay in Payments	19
	10.4	Reformation	19
11.	ENFORCEABILITY		19
12.	SURVIVABILITY		19
13.	ASSIGNMENT		19
14.	BINDING AGREEMENT		19
15.	NOTICES		20
16.	WAIVER		20
17.	SEVERABILITY		20
18.	ARBITRATION		20
19.	ENTIRE AGREEMENT		21
20.	SECTION HEADINGS		21
21.	MODIFICATION OF AGREEMENT		21
22.	UNDERSTANDING OF AGREEMENT		21
23.	GOVERNING LAW		21
24.	WITHHOLDING		21
25.	JURISDICTION AND VENUE		21
26.	NO PRESUMPTION AGAINST INTEREST		22

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EMPLOYMENT AND NON-COMPETITION AGREEMENT

This Employment and Non-Competition Agreement (“Agreement”) is entered into as of the 12^th day of June, 2008 (the “Effective Date”), between Vantage International Payroll Company Pte. Ltd., a Singapore company (“Company”), and Douglas Halkett (“Employee” or “Executive”).

RECITALS:

WHEREAS, Executive is to be employed as an integral part of its management who participates in the decision-making process relative to short and long-term planning and policy for the Company, will serve on the Company’s Executive Management Committee;

WHEREAS, the Company desires to obtain assurances from the Executive that he will devote his best efforts to the Company and will not enter into competition with the Company, solicit its customers, or solicit employees of the Company after termination of his employment;

WHEREAS, Executive will serve as a key employee with special and unique talents and skills of peculiar benefit and importance to the Company; and

WHEREAS, Executive is desirous of committing himself to serve on the terms herein provided; and

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below, the Parties agree as follows:

1.                                      EMPLOYMENT TERM AND DUTIES

1.1          Term of Employment.  Effective as of the Effective Date, the Company hereby agrees to employ Executive as its Chief Operating Officer, and Executive hereby agrees to accept such employment, on the terms and conditions set forth herein, for the period commencing on the Effective Date and expiring as of June 12, 2010 (the “Basic Term”) (unless sooner terminated as hereinafter set forth). The Basic Term shall be automatically extended for successive terms of one (1) year commencing on each Anniversary of the Effective Date thereafter (each such date being a “Renewal Date”), so as to terminate one (1) year from such Renewal Date, unless and until at least ninety (90) days prior to a Renewal Date either party hereto gives written notice to the other that the Term should not be further extended after the next Renewal Date (a “Notice of Non-Renewal”), in which event the Termination Date shall not be less than one (1) year following receipt of the Notice of Non-Renewal.

1.2          Duties as Employee of the Company.  Executive shall, subject to the supervision of the Chief Executive Officer and Board, have general management and control of operations in the ordinary course of its business with all such powers with respect to such management and control as may be reasonably incident to such responsibilities.  Executive shall devote his normal and regular business time, attention and skill to diligently attending to the business of the Company during the Basic Term. During the Basic Term, Executive shall not directly or indirectly render any services of a business, commercial, or professional nature to any other person, firm, corporation, or organization, whether for compensation or otherwise, without the prior written consent of the Chairman of the Board.  Notwithstanding the foregoing, it shall not be a violation of the Agreement for Executive to (i) serve on corporate, civic or charitable boards or committees, (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, and (iii) manage personal investments so long as such activities do not materially interfere or

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conflict with the performance of his duties to the Company hereunder.  The conduct of such activity shall not be deemed to materially interfere or conflict with Executive’s performance of his duties until Executive has been notified in writing thereof and given a reasonable period in which to cure the same.

1.3          Place of Performance.  During the Employment Period, the Company shall maintain its executive offices in Houston, Texas, but the Executive shall be located in other locations, as agreed between Executive and the Company.  During the Employment Period, the Company shall provide the Executive with an office and staff and other such facilities and services as shall be suitable to Executive’s position and adequate for the performance of Executive’s duties hereunder.

1.4          Fiduciary Duty.  Executive acknowledges and agrees that he owes a fiduciary duty to the Company, and further agrees to make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not act for his own benefit concerning the subject matter of his fiduciary relationship.

1.5          Compliance.  Executive agrees that he will not take any action which he knows would not comply with United States law as applicable to Executive’s employment, including, but without limitation to the Foreign Corrupt Practices Act.

2.                                      COMPENSATION AND RELATED MATTERS

2.1          Base Salary.  Executive shall receive a base salary (the “Base Salary”) paid by the Company at the annual rate of Four Hundred Thousand ($400,000.00) U.S., payable not less frequently than in substantially equal monthly installments, with the opportunity to increases, from time to time thereafter which are in accordance with the Company’s regular executive compensation practices.

2.2          Bonus Payments.  For each full fiscal year of the Company that begins and ends during the Employment Period, and for the portion of the fiscal year of the Company that begins in 2008 (“Fiscal Year 2008”), the Executive shall be eligible to earn an annual cash bonus in such amount as shall be determined by the Compensation Committee of the Board (the “Compensation Committee”) (the “Annual Bonus”) based on the achievement by the Company of performance goals established by the Compensation Committee for each such fiscal year (or portion of Fiscal Year 2008).  The Compensation Committee shall establish objective criteria to be used to determine the extent to which performance goals have been satisfied.  For purposes of this Agreement, net earnings per share is defined as the Company’s consolidated net earnings per share as reported in the Company’s Annual Report on Form 10-K.  The Executive’s annual bonus potential target shall not be less than eighty percent (80%) of Base Salary.

2.3          Expenses.  During the Basic Term, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by him in accordance with the policies and procedures established by the Compensation Committee for the Company’s senior executive officers in performing services hereunder, provided that Executive properly accounts for such expenses in accordance with the Company’s policies and procedures.

2.4          Automobiles.  The Company shall provide the Executive with an automobile provided by the Company, or, in the alternative, an automobile allowance consistent with the practices of the Company.

2.5          Business, Travel and Entertainment Expenses.  The Company shall promptly reimburse the Executive for all business, travel and entertainment expenses consistent with the Executive’s titles and the practices of the Company.

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2.6          Vacation.  The Executive shall be entitled to six (6) weeks of vacation per year. Vacation not taken during the applicable fiscal year (but not in excess of two (2) weeks) shall be carried over to the next following fiscal year.

2.7          Welfare, Pension and Incentive Benefit Plans.  During the Employment Period, the Executive (and his eligible spouse and dependents) shall be entitled to participate in all the welfare benefit plans and programs maintained by the Company from time-to-time for the benefit of its senior executives including, without limitation, all medical, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs. In addition, during the Employment Period, the Executive shall be eligible to participate in all pension, retirement, savings and other employee benefit plans and programs maintained from time-to-time by the Company for the benefit of its senior executives, other than any annual cash incentive plan.

2.8          Dues.  During the Employment Period, the Company shall pay or promptly reimburse the Executive for annual dues for membership in professional organizations relevant to Executive’s job responsibilities.

2.9          Other Benefits.  Executive shall be entitled to participate in or receive benefits under any compensatory employee benefit plan or other arrangement made available by the Company now or in the future to its senior executive officers and key management employees, subject to and on a basis consistent with the terms, conditions, and overall administration of such plan or arrangement. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the Base Salary payable to Executive pursuant to Section 2.1 of this Agreement.  The Company shall not make any changes in any employee benefit plans or other arrangements in effect on the date hereof or subsequently in effect in which Executive currently or in the future participates (including, without limitation, each pension and retirement plan, supplemental pension and retirement plan, savings and profit sharing plan, stock or unit ownership plan, stock or unit purchase plan, stock or unit option plan, life insurance plan, medical insurance plan, disability plan, dental plan, health and accident plan, or any other similar plan or arrangement) that would adversely affect Executive’s rights or benefits thereunder, unless such change occurs pursuant to a program applicable to substantially all executives of the Company and does not result in a proportionately greater reduction in the rights of or benefits to Executive as compared with any other executive of the Company.  The Company shall recommend that Executive receive an annual award of restricted stock and/or stock options in Vantage Drilling Company in the amount of approximately One Million Two Hundred Fifty Thousand Dollars ($1,250,000.00) based on market studies of industry executives, but Executive recognizes and agrees that future years could vary significantly as market conditions and industry compensation trends change.

2.10        Perquisites.  Executive shall be entitled to receive the perquisites and fringe benefits appertaining to an executive officer of the Company, in accordance with any practice established by the Compensation Committee.  In addition to the other benefits provided in this Agreement, Executive and his family shall be entitled to receive medical insurance as that may be provided under the Company’s group program, as such group program may be changed from time-to-time in the future, and Executive shall be entitled to continue to be covered by such group program or, if not permitted under the terms of the group program, then the Company shall provide Executive with a medical insurance policy providing substantially similar benefits as to the group program, for the period ending on the date of the later to die of Executive or, if Executive is married on the date of his death, Executive’s spouse.  Executive shall be entitled to receive the medical benefits defined herein at no cost to the Executive.  However, Executive’s

3

rights pursuant to this subsection shall be void if Executive is terminated for Cause or if Executive voluntarily terminates his employment.

2.11        Proration.  Any payments or benefits payable to Executive hereunder in respect of any calendar year during which Executive is employed by the Company for less than the entire year, unless otherwise provided in the applicable plan or arrangement, shall be prorated in accordance with the number of days in such calendar year during which he is so employed.

2.12        Signing Bonus.  Executive acknowledges receipt of a signing bonus in the amount of Twenty Five Thousand Dollars ($25,000.00) which was paid prior to the Effective Date upon commencement of his duties as Chief Operating Officer.

2.13        Additional Payments.

(a)           Excise Tax; Gross-Up Payment.  Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by the Company to or for 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 under this Section (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (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, without limitation, 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.

(b)           Accounting Firm Determinations.  All determinations required to be made under this Section 2.12, including whether and when 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 a reputable accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (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. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting a Change of Control of the Company, the Executive shall appoint another reputable 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 Section, shall be paid by the Company to the Executive within five (5) days after 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 should have been made (an “Underpayment”), consistent with the calculations required to be

4

made hereunder.  In the event that the Company exhausts its remedies pursuant to this Section and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment and any applicable penalty that has occurred and the amount of any such Underpayment and any applicable penalty shall be promptly paid by the Company to or for the benefit of the Executive.

(c)           Notification of Claims.  The Executive shall notify the Company in writing of any claims by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as practicable but no later than thirty (30) days after the Executive actually receives notice 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 thirty (30) day period following the date on which the Executive 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:

1.             give the Company any information reasonably requested by the Company relating to such claim;

2.             take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;

3.             cooperate with the Company in good faith in order to effectively contest such claim; and

4.             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 on the foregoing provisions of this Section, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego 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 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 further provided 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

5

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)           Refund.  If, after the receipt by the Executive of an amount advanced by the Company pursuant to this Section, 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 this Section) 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 this Section, 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 thirty (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.

(e)           Insurance.  The Company may, from time to time, apply for and take out, in its own name and at its own expense, naming itself or one or more of its affiliates as the designated beneficiary (which it may change from time to time), policies for life, health, accident, disability or other insurance upon the Executive in any amount or amounts that it may deem necessary or appropriate to protect its interest.  The Executive agrees to aid the Company in procuring such insurance by submitting to medical examinations and by completing, executing and delivering such applications and other instruments in writing as may reasonably be required by an insurance company or companies to which any application or applications for insurance may be made by or for the Company.

3.                                      TERMINATION

3.1          Definitions.

A.            “Cause” shall mean:

(i)            Material dishonesty which is not the result of an inadvertent or innocent mistake of Executive with respect to the Company or any of its subsidiaries;

(ii)           Willful misfeasance or nonfeasance of duty by Executive intended to injure or having the effect of injuring in some material fashion the reputation, business, or business relationships of the Company or any of its subsidiaries or any of their respective officers, directors, or employees;

(iii)          Material violation by Executive of any material term of this Agreement;

(iv)          Conviction of Executive of any felony, any crime involving moral turpitude or any crime other than a vehicular offense which could reflect in some material fashion unfavorably upon the Company or any of its subsidiaries; or

(v)           Violation of Sections 1.3 or 1.4 above.

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3.1.2       Notice to Cure.  Executive may not be terminated for Cause unless and until there has been delivered to Executive written notice from the Board supplying the particulars of Executive’s acts or omissions that the Board believes constitute Cause, a reasonable period of time (not less than 30 days) has been given to Executive after such notice to either cure the same or to meet with the Board, with his attorney if so desired by Executive, and following which the Board by action of not less than two-thirds of its members furnishes to Executive a written resolution specifying in detail its findings that Executive has been terminated for Cause as of the date set forth in the notice to Executive.

3.1.3       For purposes of this Agreement, no act or failure to act by the Executive shall be considered “willful” if such act is done by the Executive in the good faith belief that such act is or was to be beneficial to the Company or one or more of its businesses, or such failure to act is due to the Executive’s good faith belief that such action would be materially harmful to the Company or one of its businesses.  Cause shall not exist unless and until the Company has delivered to the Executive a copy of a resolution duly adopted by a majority of the Board (excluding the Executive for purposes of determining such majority) at a meeting of the Board called and held for such purpose after reasonable (but in no event less than thirty days’) notice to the Executive and an opportunity for the Executive, together with his counsel, to be heard before the Board, finding that in the good faith opinion of the Board that “Cause” exists, and specifying the particulars thereof in detail.  This Section shall not prevent the Executive from challenging in an arbitration proceeding the Board’s determination that Cause exists or that the Executive has failed to cure any act (or failure to act) that purportedly formed the basis for the Board’s determination.

B.              A “Chance of Control” shall be deemed to have occurred if:

(i)            A reverse merger involving the Company or the Parent in which the Company or the Parent, as the case may be, is the surviving corporation but the shares of common stock of the Company or the Parent (the “Common Stock”) outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise, and the shareholders of the Parent immediately prior to the completion of such transaction hold, directly or indirectly, less than fifty percent (50%) of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act, or comparable successor rules) of the surviving entity or, if more than one entity survives the transaction, the controlling entity; or

(ii)           Any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of 50% or more of the Company’s then outstanding voting common stock; or

(iii)          At any time during the period of three (3) consecutive years (not including any period prior to the date hereof), individuals who at the beginning of such period constituted the Board (and any new director whose election by the Board or whose nomination for election by the Company’s shareholders were approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election or

7

nomination for election was previously so approved) cease for any reason to constitute a majority thereof; or

(iv)          The shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation (a) in which a majority of the directors of the surviving entity were directors of the Company prior to such consolidation or merger, and (b) which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being changed into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation; or

(v)           The shareholders approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

C.            A “Disability” shall mean the absence of Executive from Executive’s duties with the Company on a full-time basis for 180 consecutive days, or 180 days in a 365-day period, as a result of incapacity due to mental or physical illness which results in the Executive being unable to perform the essential functions of his position, with or without reasonable accommodation.

D.            A “Good Reason” shall mean any of the following (without Executive’s express written consent):

(i)            Following a Change of Control, a material alteration in the nature or status of Executive’s title, duties or responsibilities, or the assignment of duties or responsibilities inconsistent with Executive’s status, title, duties and responsibilities;

(ii)           A failure by the Company to continue in effect any employee benefit plan in which Executive was participating, or the taking of any action by the Company that would adversely affect Executive’s participation in, or materially reduce Executive’s benefits under, any such employee benefit plan, unless such failure or such taking of any action adversely affects the senior members of corporate management of the Company generally to the same extent;

(iii)          Any material breach by the Company of any provision of this Agreement;

(iv)          Any failure by the Company to obtain the assumption and performance of this Agreement by any successor (by merger, consolidation, or otherwise) or assign of the Company; or

(v)           The Company provides written notice of non-renewal to the Executive.

However, Good Reason shall exist with respect to an above specified matter only if such matter is not corrected by the Company within thirty (30) days of its receipt of written notice of

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such matter from Executive, and in no event shall a termination by Executive occurring more than ninety (90) days following the date of the event described above be a termination for Good reason due to such event.

3.2          Termination Date.  “Termination Date” shall mean the date Executive is terminated for any reason pursuant to this Agreement.

3.3          Constructive Termination Without Cause.  “Constructive Termination Without Cause” shall mean: Notwithstanding any other provision of this Agreement, the Executive’s employment under this Agreement may be terminated during the Term by the Executive, which shall be deemed to be constructive termination by the Company without Cause, if one of the following events shall occur without the written consent of the Executive: (i) a reduction in the Executive’s fixed salary; (ii) the failure of the Company to continue to provide the Executive with office space, related facilities and secretarial assistance that are commensurate with the Executive’s responsibilities to and position with the Company; (iii) the notification by the Company of the Company’s intention not to observe or perform one or more of the obligations of the Company under this Agreement; or (iv) the failure by the Company to indemnify, pay or reimburse the Executive at the time and under the circumstances required by this Agreement.  Any such termination pursuant to this Section shall be made by the Executive providing written notice to the Company specifying the event relied upon for such termination and given within sixty (60) days after such event.  Any constructive termination pursuant to this Section shall be effective sixty (60) days after the date the Executive has given the Company such written notice setting forth the grounds for such termination with specificity; provided, however, that the Executive shall not be entitled to terminate this Agreement in respect of any of the grounds set forth above if within sixty (60) days after such notice the action constituting such ground for termination has been cured and is no longer continuing.

3.4          Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits.

3.5          Base Salary and Annual Bonus.  For a period of twenty four (24) months after the Termination Date, Base Salary and Annual Bonus (as such terms are defined herein) at the rate, and payable quarterly unless such termination is by the Company without Cause, in which even such amount of Base Salary and Annual Bonus shall be paid in a lump sum within ten (10) days of the Termination Event.

3.6          Stock Awards.  If there is a Change of Control or if there is a Termination Event, any stock or stock option award issued pursuant to the 2007 Long Term Incentive Compensation Plan (“Stock Awards”) which Executive has received under this Agreement shall vest immediately and, if there is a Termination Event, all such Stock Awards shall be exercisable from the date of such Termination Event for the remainder of their term.

3.7          Other Benefits.  To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other amounts or benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy or practice, or contract or agreement of the Company and its affiliated companies for the period of time equal to the remainder of the Basic Term (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).  Without limiting the preceding sentence and without limiting any other provision of this Agreement, through the remaining Basic Term, but under no condition less than one (1) year, the Company, at its sole expense, shall continue to provide (through its own plan and/or individual policies) Executive (and Executive’s dependents) with health benefits no less favorable than the group health plan benefits provided during such period to any senior executive officer of the Company or any affiliated company (to the extent any

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such coverage or benefits are taxable to Executive by reason of being provided under a self-insured health plan of the Company or an affiliate, the Company shall make Executive “whole” for the same on an after-tax basis).  In any event, the Other Benefits provided for pursuant to this Section shall be secondary to any benefits and coverage Executive (or his dependents) receive from another employer.

3.8          Expenses.  All accrued compensation and unreimbursed expenses through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the Termination Date; and

3.9          Mitigation.  Executive shall be free to accept other employment during such period, subject to the limitation as set forth in Section 5 of this Agreement and there shall be no offset of any employment compensation earned by Executive in such other employment during such period against payments due Executive under this Section 3, and there shall be no offset in any compensation received from such other employment against the Base Salary set forth above.

3.10        Maximum Payments.  It is the objective of this Agreement to maximize the Executive’s Net After-Tax Benefit (as defined herein) if payments or benefits provided under this Section are subject to excise tax under Section 4999 of the Code.  Therefore, in the event it is determined that any payment or benefit 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 Section or otherwise, including, by example and not by way of limitation, acceleration by the Company or otherwise of the date of vesting or payment or rate of payment under any plan, program or arrangement of the Company, would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties 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”), the Company shall first make a calculation under which such payments or benefits provided to the Executive under this Agreement are reduced to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code (the “4999 Limit”).  The Company shall then compare (x) the Executive’s Net After-Tax Benefit assuming application of  the 4999 Limit with (y) the Executive’s Net After-Tax Benefit without the application of the 4999 Limit and the Executive shall be entitled to the greater of (x) or (y).

3.11        Net After-Tax Benefit.  “Net After-Tax Benefit” shall mean the sum of (i) all payments and benefits which the Executive receives or is then entitled to receive from the Company, less (ii) the amount of federal income taxes payable with respect to the payments and benefits described in (i) above calculated at the maximum marginal income tax rate for each year in which such payments and benefits shall be paid to the Executive (based upon the rate for such year as set forth in the Code at the time of the first payment of the foregoing), less (iii) the amount of excise taxes imposed with respect to the payments and benefits described in (i) above by Section 4999 of the Code.  The determination of whether a payment or benefit constitutes an excess parachute payment shall be made by tax counsel selected by the Company and reasonably acceptable to the Executive. The costs of obtaining this determination shall be borne by the Company.

3.12        Termination In Event of Death: Benefits.  If Executive’s employment is terminated by reason of Executive’s death during the Basic Term, this Agreement shall terminate, except as provided herein, without further obligation to Executive’s legal representatives under this Agreement, other than for payment of all accrued compensation, unreimbursed expenses, the timely payment or provision of Other Benefits through the date of death, one (1) year’s Base Salary, and such cash or stock bonus as Executive would otherwise have been awarded in year if Executive’s death had not occurred.  Such amounts shall be paid to Executive’s estate or beneficiary, as applicable, in a lump sum in cash within ninety (90) days after the date of death.  With respect to the provision of Other Benefits, the term Other

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Benefits as used in this Section shall include, without limitation, and Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company to the estates and beneficiaries of other executive level employees of the Company under such plans, programs, practices, and policies relating to death benefits, if any, as in effect with respect to other executives and their beneficiaries at any time during the 120-day period immediately preceding the date of death.  Additionally, all Stock Awards shall be vested immediately and shall be exercisable for the greater of one year after the date of such vesting or the remaining term of such option.

3.13        Termination In Event of Disability: Benefits.  If Executive’s employment is terminated by reason of Executive’s Disability during the Basic Term, this Agreement shall continue in full force for a period of one (1) year following such Disability and if such Disability occurs on or after January 1 of any year Executive shall be entitled to the same cash or stock bonus in such year that Executive would have been awarded if such Disability had not occurred. In addition, all outstanding Stock Awards shall vest immediately upon such termination due to Disability.

3.14        Voluntary Termination by Employee and Termination for Cause: Benefits. Executive may terminate his employment with the Company without Good Reason by giving written notice of his intent and stating an effective Termination Date at least ninety (90) days after the date of such notice; provided, however, that the Company may accelerate such effective date by paying Executive through the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date.  Upon such a termination by Executive, except as provided in Section 5, or upon termination for Cause by the Company, this Agreement shall terminate and the Company shall pay to Executive all accrued compensation, unreimbursed expenses and the Other Benefits through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the date of termination.  In addition, all unvested stock options shall terminate and all vested options will terminate one hundred twenty (120) days after the Termination Date.

3.15        Termination Procedure.

A.            Notice of Termination.  Any termination of the Executive’s employment by the Company or by the Executive during the Employment Period (other than pursuant to Section 3.5) shall be communicated by written Notice of Termination to the other party. For purposes of this Agreement, a “Notice of Termination” shall mean a notice indicating the specific termination provision in this Agreement relied upon and setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under that provision.

B.            Date of Termination.  “Date of Termination” shall mean (i) if the Executive’s employment is terminated by his death, the date of his death, (ii) if the Executive’s employment is terminated pursuant to Section 3.13, thirty (30) days after the date of receipt of the Notice of Termination (provided that the Executive does not return to the substantial performance of his duties on a full-time basis during such thirty (30) day period), and (iii) if the Executive’s employment is terminated for any other reason, the date on which a Notice of Termination is given or any later date (within thirty (30) days after the giving of such notice) set forth in such Notice of Termination.

C.            Mitigation.  The Executive shall not be required to mitigate damages with respect to the termination of his employment under this Agreement by seeking other employment or otherwise, and there shall be no offset against amounts due the Executive under this Agreement

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on account of subsequent employment except as specifically provided in this Agreement. Additionally, amounts owed to the Executive under this Agreement shall not be offset by any claims the Company may have against the Executive, and the Company’s obligation to make the payments provided for in this Agreement, and otherwise to perform its obligations hereunder, shall not be affected by any other circumstances, including, without limitation, any counterclaim, recoupment, defense or other right which the Company may have against the Executive or others.

4.                                      DIRECTOR POSITIONS

Executive agrees that upon termination of employment, for any reason, at the request of the Chairman of the Board, he will immediately tender his resignation from any and all Board positions held with the Company and/or any of its subsidiaries and affiliates. If Executive remains as a director, at the election of the Board, after such termination, Executive shall be compensated as an outside director.

5.                                      NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY

The Company shall provide Executive with its trade secrets, goodwill, and confidential information of Company and contact with the Company’s customers and potential customers.  Executive also recognizes and agrees that the benefit of not being employed at-will, is provided in consideration for, among other things, the agreements contained in this Section, as well as the Stock Awards granted to Executive pursuant to this Agreement.  Executive agrees that the business of the Company is highly competitive and that the trade secrets, goodwill, and confidential information of the Company is of primary importance to the success of the Company.  In consideration of all of the foregoing, and in recognition of these conditions, and specifically for being provided trade secrets, goodwill, and confidential information, Executive agrees as follows:

5.1          Non-Competition During Employment.  Executive agrees during the Basic Term he will not compete with the Company by engaging in the conception, design, development, production, marketing, or servicing of any product or service that is substantially similar to the products or services which the Company provides, and that he will not work for, in any capacity, assist, or became affiliated with as an owner, partner, etc., either directly or indirectly, any individual or business which offer or performs services, or offers or provides products substantially similar to the services and products provided by Company.

5.2          Conflicts of Interest.  Executive agrees that during the Basic Term, he will not engage, either directly or indirectly, in any activity (a “Conflict of Interest”) which might adversely affect the Company or its affiliates, including ownership of a material interest in any supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business or accepting any material payment, service, loan, gift, trip, entertainment, or other favor from a supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business, and that Executive will promptly inform the Chairman of the Company as to each offer received by Executive to engage in any such activity. Executive further agrees to disclose to the Company any other facts of which Executive becomes aware which might in Executive’s good faith judgment reasonably be expected to involve or give rise to a Conflict of Interest or potential Conflict of Interest.

5.3          Non-Competition After Termination.  In further consideration of the Company providing Employee confidential information, executive agrees that Executive shall not, at any time during the period of one (1) year after termination within the geographic area as defined by this Section 5 that the Company has sold products or services or formulated a plan to sell products or services into a

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market during the last twelve (12) months of Executive’s employ, engage in or contribute Executive’s knowledge to any work which is competitive with or similar to a product, process, apparatus, services, or development on which Executive worked or with respect to which Executive had access to Confidential Information while employed by the Company.  It is understood that the geographical area set forth in this covenant is divisible so that if this clause is invalid or unenforceable in an included geographic area, that area is severable and the clause remains in effect for the remaining included geographic areas in which the clause is valid. For purposes of this Section 5.3, the geographic area shall apply to the territory or country where the Company conducts operations.

5.4          Non-Solicitation of Customers.  In further consideration of the Company providing Employees confidential information, Executive further agrees that for a period of one (1) year after termination, he will not solicit or accept any business from any customer or client or prospective customer or client with whom Executive dealt or solicited while employed by Company during the last twelve (12) a months of his employment.

5.5          Non-Solicitation of Employees.  Executive agrees that for the duration of the Basic Term, and for a period of one (1) year after the termination of the Basic Term, he will not either directly or indirectly, on his own behalf or on behalf of others, solicit, attempt to hire, or hire any person employed by Company to work for Executive or for another entity, firm, corporation, or individual.

5.6          Confidential Information.  Executive further agrees that he will not, except as the Company may otherwise consent or direct in writing, reveal or disclose, sell, use, lecture upon, publish or otherwise disclose to any third party any Confidential Information or proprietary information of the Company, or authorize anyone else to do these things at any time either during or subsequent to his employment with the Company.  This Section shall continue in full force and effect after termination of Executive’s employment and after the termination of this Agreement.  Executive shall continue to be obligated under the Confidential Information Section of this Agreement not to use or to disclose Confidential Information of the Company so long as it shall not be publicly available.  Executive’s obligations under this Section with respect to any specific Confidential Information and proprietary information shall cease when that specific portion of the Confidential Information and proprietary information becomes publicly known, in its entirety and without combining portions of such information obtained separately.  It is understood that such Confidential Information and proprietary information of the Company include matters that Executive conceives or develops, as well as matters Executive learns from other employees of Company. Confidential Information is defined to include information: (1) disclosed to or known by the Executive as a consequence of or through his employment with the Company; (2) not generally known outside the Company; and (3) which relates to any aspect of the Company or its business, finances, operation plans, budgets, research, or strategic development. “Confidential Information” includes, but is not limited to the Company’s trade secrets, proprietary information, financial documents, long range plans, customer lists, employer compensation, marketing strategy, data bases, costing data, computer software developed by the Company, investments made by the Company, and any information provided to the Company by a third party under restrictions against disclosure or use by the Company or others.

5.7          Original Material.  The Executive agrees that any inventions, discoveries, improvements, ideas, concepts or original works of authorship relating directly to the Company Business, including without limitation information of a technical or business nature such as ideas, discoveries, designs, inventions, improvements, trade secrets, know-how, manufacturing processes, product formulae, design specifications, writings and other works of authorship, computer programs, financial figures, marketing plans, customer lists and data, business plans or methods and the like, which relate in any manner to the actual or anticipated business or the actual or anticipated areas of research and development

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of the Company and its divisions and affiliates, whether or not protectable by patent or copyright, that have been originated, developed or reduced to practice by the Executive alone or jointly with others during the Executive’s employment with the Company shall be the property of and belong exclusively to the Company. The Executive shall promptly and fully disclose to the Company the origination or development by the Executive of any such material and shall provide the Company with any information that it may reasonably request about such material.  Either during the subsequent to the Executive’s employment, upon the request and at the expense of the Company or its nominee, and for no remuneration in addition to that due the Executive pursuant to the Executive’s employment by the Company, but at no expense to the Executive, the Executive agrees to execute, acknowledge, and deliver to the Company or its attorneys any and all instruments which, in the judgment of the Company or its attorneys, may be necessary or desirable to secure or maintain for the benefit of the Company adequate patent, copyright, and other property rights in the United States and foreign countries with respect to any such inventions, improvements, ideas, concepts, or original works of authorship embraced within this Agreement.

5.8          Return of Documents, Equipment, Etc.  All writings, records, and other documents and things comprising, containing, describing, discussing, explaining, or evidencing any Confidential Information, and all equipment, components, parts, tools, and the like in Executive’s custody or possession that have been obtained or prepared in the course of Executive’s employment with the Company shall be the exclusive property of the Company, shall not be copied and/or removed from the premises of the Company, except in pursuit of the business of the Company, and shall be delivered to the Company, without Executive retaining any copies, upon notification of the termination of Executive’s employment or at any other time requested by the Company. The Company shall have the right to retain, access, and inspect all property of Executive of any kind in the office, work area, and on the premises of the Company upon termination of Executive’s employment and at any time during employment by the Company upon termination of Executive’s employment and at any time during employment by the Company to ensure compliance with the terms of this Agreement.

5.9          Reaffirm Obligations.  Upon termination of his employment with the Company, Executive, if requested by Company, shall reaffirm in writing Executive’s recognition of the importance of maintaining the confidentiality of the Company’s Confidential Information and proprietary information, and reaffirm any other obligations set forth in this Agreement.

5.10        Prior Disclosure.  Executive represents and warrants that he has not used or disclosed any Confidential Information he may have obtained from Company prior to signing this Agreement, in any way inconsistent with the provisions of this Agreement.

5.11        Confidential Information of Prior Companies.  Executive will not disclose or use during the period of his employment with the Company any proprietary or Confidential Information or Copyright Works which Executive may have acquired because of employment with an employer other than the Company or acquired from any other third party, whether such information is in Executive’s memory or embodied in a writing or other physical form

5.12        Rights Upon Breach.  If the Executive breaches, any of the provisions contained in Section 5 of this Agreement (the “Restrictive Covenants”), the Company shall have the following rights and remedies, each of which rights and remedies shall be independent of the others and severally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity:

(a)           Specific Performance.  The right and remedy to have the Restrictive Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach of the

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Restrictive Covenants would cause irreparable injury to the Company and that money damages would not provide an adequate remedy to the Company.

(b)           Accounting.  The right and remedy to require the Executive to account for and pay over to the Company all compensation, profits, monies, accruals, increments or other benefits derived or received by the Executive as the result of any action constituting a breach of the Restrictive Covenants.

5.13        Remedies For Violation of Non-Competition or Confidentiality Provisions. Without limiting the right of the Company to pursue all other legal and equitable rights available to it for violation of any of the obligations and covenants made by Employee herein, it is agreed that:

(a)           the skills, experience and contacts of Employee are of a special, unique, unusual and extraordinary character which give them a peculiar value;

(b)           because of the business of the Company, the restrictions agreed to by Employee as to time and area contained in the Agreement are reasonable; and

(c)           the injury suffered by the Company by a violation of any obligation or covenant in the Agreement resulting from loss of profits created by (i) the competitive use of such skills, experience contacts and otherwise and/or (ii) the use or communication of any information deemed confidential herein will be difficult to calculate in damages in an action at law and cannot fully compensate the Company for any violation of any obligation or covenant in the Agreement, accordingly:

(i)            the Company shall be entitled to injunctive relief to prevent violations thereof and prevent Employee from rendering any services to any person, firm or entity in breach of such obligation or covenant and to prevent Employee from divulging any confidential information; and

(ii)           compliance with the Agreement is a condition precedent to the Company’s obligation to make payments of any nature to employee, subject to the other provisions hereof.

(d)           employee waives any objection to the enforceability of the restrictive covenants and agrees to be estopped from denying the legality and enforceability of these provisions.

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5.14        Severability of Covenants.  The Executive acknowledges and agrees that the Restrictive Covenants are reasonable and valid in duration and geographical scope and in all other respects.  If any court determines that any of the Restrictive Covenants, or any part thereof, is invalid or unenforceable, the remainder of the Restrictive Covenants shall not thereby be affected and shall be given full effect without regard to the invalid portions.

5.15        Court Review.  If any court determines that any of the Restrictive Covenants, or any part thereof is unenforceable because of the duration or geographical scope of or scope of activities restrained by, such provision, such court shall have the power to reduce the duration or scope of such provision, as the case may be, and, in its reduced form, such provision shall then be enforceable.

5.16        Enforceability in Jurisdictions.  The Company and the Executive intend to and hereby confer jurisdiction to enforce the Restrictive Covenants upon the courts of any jurisdiction within the geographical scope of such Restrictive Covenants.  If the courts of any one or more of such jurisdictions hold the Restrictive Covenants unenforceable by reason of the breadth of such scope or otherwise, it is the intention of the Company that such determination not bar or in any way affect the right of the Company to the relief provided above in the courts of any other jurisdiction within the geographical scope of such Restrictive Covenants, as to breaches of such Restrictive Covenants in such other respective jurisdictions, such Restrictive Covenants as they relate to each jurisdiction being, for this purpose, severable into diverse and independent covenants.

5.17        Extension of Post-Employment Restrictions.  In the event Executive breaches Section 5 above, the restrictive time periods contained in those provisions will be extended by the period of time Executive was in violation of such provisions.

6.                                      INDEMNIFICATION

6.1          General.  The Company agrees that if the Executive is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”), by reason of the fact that the Executive is or was a trustee, director or officer of the Company, the Company, or any predecessor to the Company (including any sole proprietorship owned by the Executive) or any of their affiliates or is or was serving at the request of the Company, the Company, any predecessor to the Company (including any sole proprietorship owned by the Executive), or any of their affiliates as a trustee, director, officer, member, employee or agent of another corporation or a partnership, joint venture, limited liability company, trust or other enterprise, including, without limitation, service with respect to employee benefit plans, whether or not the basis of such Proceeding is alleged action in an official capacity as a trustee, director, officer, member, employee or agent while serving as a trustee, director, officer, member, employee or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by Texas or Delaware law, as the same exists or may hereafter be amended, against all Expenses incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to the Executive even if the Executive has ceased to be an officer, director, trustee or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators.

6.2          Expenses.  As used in this Section, the term “Expenses” shall include, without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, and costs, attorneys’ fees, accountants’ fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing a right to indemnification under this Agreement.

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6.3          Enforcement.  If a claim or request under this Section 6 is not paid by the Company or on its behalf, within thirty (30) days after a written claim or request has been received by the Company, the Executive may at any time thereafter bring an arbitration claim against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part, the Executive shall be entitled to be paid also the expenses of prosecuting such suit.  All obligations for indemnification hereunder shall be subject to, and paid in accordance with, applicable Texas or Delaware law.

6.4          Partial Indemnification.  If the Executive is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify the Executive for the portion of such Expenses to which the Executive is entitled.

6.5          Advances of Expenses.  Expenses incurred by the Executive in connection with any Proceeding shall be paid by the Company in advance upon request of the Executive that the Company pay such Expenses, but only in the event that the Executive shall have delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect to which the Executive is not entitled to indemnification and (ii) a statement of his good faith belief that the standard of conduct necessary for indemnification by the Company has been met.

6.6          Notice of Claim.  The Executive shall give to the Company notice of any claim made against him for which indemnification will or could be sought under this Agreement.  In addition, the Executive shall give the Company such information and cooperation as it may reasonably require and as shall be within the Executive’s power and at such times and places as are convenient for the Executive.

6.7          Defense of Claim.  With respect to any Proceeding as to which the Executive notifies the Company of the commencement thereof:

(a)           The Company will be entitled to participate therein at its own expense.

(b)           Except as otherwise provided below, to the extent that it may wish, the Company will be entitled to assume the defense thereof, with counsel reasonably satisfactory to the Executive, which in the Company’s sole discretion may be regular counsel to the Company and may be counsel to other officers and directors of the Company or any subsidiary.  The Executive also shall have the right to employ his own counsel in such action, suit or proceeding if he reasonably concludes that failure to do so would involve a conflict of interest between the Company and the Executive, and under such circumstances the fees and expenses of such counsel shall be at the expense of the Company.

(c)           The Company shall not be liable to indemnify the Executive under this Agreement for any amounts paid in settlement of any action or claim effected without its written consent.  The Company shall not settle any action or claim in any manner which would impose any penalty that would not be paid directly or indirectly by the Company or limitation on the Executive without the Executive’s written consent. Neither the Company nor the Executive will unreasonably withhold or delay their consent to any proposed settlement.

6.8          Non-exclusivity.  The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Section 6 shall not be exclusive of any other right which the Executive may have or hereafter may acquire under any statute or certificate of incorporation or by-laws of the Company or any subsidiary, agreement, vote of shareholders or disinterested directors or trustees or otherwise.

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7.                                      LEGAL FEES AND EXPENSES

If any contest or dispute shall arise between the Company and the Executive regarding any provision of this Agreement, the Company shall reimburse the Executive for all legal fees and expenses reasonably incurred by the Executive in connection with such contest or dispute, but only if the Executive prevails to a substantial extent with respect to the Executive’s claims brought and pursued in connection with such contest or dispute.  Such reimbursement shall be made as soon as practicable following the resolution of such contest or dispute (whether or not appealed) to the extent the Company receives reasonable written evidence of such fees and expenses. The Company shall advance the Executive reasonable attorney’s fees during any arbitration proceedings if brought by the Executive, up to but not to exceed Three Hundred Thousand Dollars ($300,000.00).

8.                                      BREACH

Executive agrees that any breach of restrictive covenants above cannot be remedied solely by money damages, and that in addition to any other remedies Company may have, Company is entitled to obtain injunctive relief against Executive.  Nothing herein, however, shall be construed as limiting Company’s right to pursue any other available remedy at law or in equity, including recovery of damages and termination of this Agreement and/or any payments that may be due pursuant to this Agreement.

9.                                      RIGHT TO ENTER AGREEMENT

Executive represents and covenants to Company that he has full power and authority to enter into this Agreement and that the execution of this Agreement will not breach or constitute a default of any other agreement or contract to which he is a party or by which he is bound.

10.                                    COMPLIANCE WITH SECTION 409A

10.1        It is the intention of the Company and the Executive that this Agreement not result in unfavorable tax consequences to the Executive under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).  The Company and the Executive acknowledge that Section 409A of the Code was enacted pursuant to the American Jobs Creation Act of 2004, generally effective with respect to amounts deferred after January 1, 2005, and only limited guidance has been issued by the Internal Revenue Service with respect to the application of Code Section 409A to certain arrangements, such as this Agreement.  The Internal Revenue Service has indicated that it will provide further guidance regarding interpretation and application of Section 409A of the Code during 2005. The Company and the Executive acknowledge further that the full effect of Section 409A of the Code on potential payments pursuant to this Agreement cannot be fully determined at the time that the Company and the Executive are entering into this Agreement. The Company and the Executive agree to work together in good faith in an effort to comply with Section 409A of the Code including, if necessary, amending the Agreement based on further guidance issued by the Internal Revenue Service from time to time, provided that the Company shall not be required to assume any increased economic burden.

10.2        Certain Definitions.  As used in this Agreement, the following terms have the following meanings unless the context otherwise requires:

(a)           “affiliate” means any person controlled by or under common control with the Company but shall not include any stockholder or director of the Company, as such.

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(b)           “person” means any individual, corporation, partnership, limited liability company, firm, joint company, association, joint-stock company, trust, unincorporated organization, governmental or regulatory body or other entity.

10.3        Delay in Payments.  Notwithstanding anything to the contrary in this Agreement, (i) if upon the date of Executive’s termination of employment with the Company, Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or any regulations or Treasury guidance promulgated thereunder (the “Code”) and the deferral of any amounts otherwise payable under this Agreement as a result of Executive’s termination of employment is necessary in order to prevent any accelerated or additional tax to Executive under Code Section 409A, then the Company will defer the payment of any such amounts hereunder until the date that is six months following the date of Executive’s termination of employment with the Company, at which time any such delayed amounts will be paid to Executive in a single lump sum, with interest from the date otherwise payable at the prime rate as published in The Wall Street Journal on the date of Executive’s termination of employment with the Company, and (ii) if any other payments of money or other benefits due to Executive hereunder could cause the application of an accelerated or additional tax under Code Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Code Section 409A.

10.4        Reformation.  If any provision of this Agreement would cause Executive to occur any additional tax under Code Section 409A, the parties will in good faith attempt to reform the provision in a manner that maintains, to the extent possible, the original intent of the applicable provision without violating the provision of Code Section 409A.

11.                               ENFORCEABILITY

The agreements contained in the restrictive covenant provisions of this Agreement are independent of the other agreements contained herein.  Accordingly, failure of the Company to comply with any of its obligations outside of such Sections do not excuse Executive from complying with the agreements contained herein.

12.                               SURVIVABILITY

The agreements contained in Sections 5 shall survive the termination of this Agreement for any reason.

13.                               ASSIGNMENT

This Agreement cannot be assigned by Executive. The Company may assign this Agreement only to a successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially Al of the business and assets of the Company provided such successor expressly agrees in writing reasonably satisfactory to Executive to assume and 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 and assignment had taken place.  Failure of the Company to obtain such written agreement prior to the effectiveness of any such succession shall be a material breach of this Agreement.

14.                               BINDING AGREEMENT

Executive understands that his obligations under this Agreement are binding upon Executive’s heirs, successors, personal representatives, and legal representatives.

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15.                               NOTICES

All notices pursuant to this Agreement shall be in writing and sent certified mail, return receipt requested, addressed as set forth below, or by delivering the same in person to such party, or by transmission by facsimile to the number set forth below.  Notice deposited in the manner described hereinabove, shall be effective upon deposit.  Notice given in any other manner shall be effective only if and when received:

If to Executive:

Douglas Halkett

1 Jalan Kilang Timor,

#07-01 Pacific Tech Centre,

Singapore 159303

If to Company:

Vantage International Payroll Company Pte. Ltd.

c/o Vantage Drilling Company

777 Post Oak Blvd., Suite 610

Houston, Texas 77056

16.                               WAIVER

No waiver by either party to this Agreement of any right to enforce any term or condition of this Agreement, or of any breach hereof shall be deemed a waiver of such right in the future or of any other right or remedy available under this Agreement.  The Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3.2 hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

17.                               SEVERABILITY

If any provision of this Agreement is determined to be void invalid, unenforceable, or against public policy, such provisions shall be deemed severable from the Agreement, and the remaining provisions of the Agreement will remain unaffected and in full force and effect.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

18.                               ARBITRATION

In the event any dispute arises out of Executive’s employment with or by the Company, or separation/termination therefrom, whether as an employee, which cannot be resolved by the Parties to this Agreement, such dispute shall be submitted to final and binding arbitration.  The arbitration shall be conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA”).  If the Parties cannot agree on an arbitrator, a list of seven

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(7) arbitrators will be requested from AAA, and the arbitrator will be selected using alternate strikes with Executive striking firm. The cost of the arbitration will be borne solely by the Company.  Arbitration of such disputes is mandatory and in lieu of any and all civil causes of action and lawsuits either party may have against the other arising out of Executive’s employment with Company, or separation therefrom.  Such arbitration shall be held in Houston, Texas.  This provision shall not, however, preclude the Company from obtaining injunctive relief in any court of competent jurisdiction to enforce Section 5 of this Agreement.

19.                               ENTIRE AGREEMENT

The terms and provisions contained herein shall constitute the entire agreement between the parties with respect to Executive’s employment with Company during the time period covered by this Agreement. This Agreement replaces and supersedes any and all existing Agreements entered into between Executive and the Company relating generally to the same subject matter, if any, except the offer of employment to Executive, dated October 31, 2007, and shall be binding upon Executive’s heirs, executors, administrators, or other legal representatives or assigns.

20.                               SECTION HEADINGS

The section headings in this Employment Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation.

21.                               MODIFICATION OF AGREEMENT

This Agreement may not be changed or modified or released or discharged or abandoned or otherwise terminated, in whole or in part, except by an instrument in writing signed by the Executive and an officer or other authorized executive of Company.

22.                               UNDERSTANDING OF AGREEMENT

Executive represents and warrants that he has read and understood each and every provision of this Agreement, and Executive understands that he has the right to obtain advice from legal counsel of choice, if necessary and desired, in order to interpret any and all provisions of this Agreement, and that Executive has freely and voluntarily entered into this Agreement.

23.                               GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

24.                               WITHHOLDING

All payments hereunder shall be subject to any required withholding of Federal, state and local taxes pursuant to any applicable law or regulation, except as provided in any tax equalization program or policy adopted by the Company for expatriate employees.

25.                               JURISDICTION AND VENUE

With respect to any litigation regarding this Agreement, Executive agrees to venue in the state or federal courts in Harris County, Texas and agrees to waive and does hereby waive any defenses and/or

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arguments based upon improper venue and/or lack of personal jurisdiction.  By entering into this Agreement, Executive agrees to personal jurisdiction in the state and federal courts in Harris County, Texas.

26.                               NO PRESUMPTION AGAINST INTEREST

This Agreement has been negotiated, drafted, edited and reviewed by the respective parties, and therefore, no provision arising directly or indirectly herefrom shall be construed against any party as being drafted by said party.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first above written.

EXECUTIVE
/s/ Douglas Halkett
DOUGLAS HALKETT
VANTAGE INTERNATIONAL PAYROLL COMPANY PTE. LTD.
By:	/s/ Paul A. Bragg
Name:			Paul A. Bragg
Title:		Chief Executive Officer

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EX-10.6

Exhibit 10.6

EMPLOYMENT AND NON-COMPETITION AGREEMENT

BETWEEN

VANTAGE DRILLING COMPANY

AND

DOUGLAS G. SMITH

DATED JUNE 12, 2008

TABLE OF CONTENTS

			Page
1.	EMPLOYMENT TERM AND DUTIES		1
	1.1	Term of Employment	1
	1.2	Duties as Employee of the Company	1
	1.3	Place of Performance	2
	1.4	Fiduciary Duty	2
	1.5	Compliance	2
2.	COMPENSATION AND RELATED MATTERS		2
	2.1	Base Salary	2
	2.2	Bonus Payments	2
	2.3	Expenses	3
	2.4	Automobiles	3
	2.5	Business, Travel and Entertainment Expenses	3
	2.6	Vacation	3
	2.7	Welfare, Pension and Incentive Benefit Plans	3
	2.8	Dues	3
	2.9	Other Benefits	3
	2.10	Perquisites	4
	2.11	Proration	4
	2.12	Intentionally Left Blank	4
	2.13	Additional Payments	4
		(a)     Excise Tax; Gross-Up Payment	4
		(b)     Accounting Firm Determinations	5
		(c)     Notification of Claims	5
		(d)     Refund	6
		(e)     Insurance	7
3.	TERMINATION		7
	3.1	Definitions	7
	3.1.2	Notice to Cure	7
	3.2	Termination Date	10
	3.3	Constructive Termination Without Cause	10
	3.4	Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits	10
	3.5	Base Salary	11
	3.6	Stock Awards	11
	3.7	Other Benefits	11
	3.8	Expenses	11
	3.9	Mitigation	11
	3.10	Maximum Payments	11
	3.11	Net After-Tax Benefit	12
	3.12	Termination In Event of Death: Benefits	12
	3.13	Termination In Event of Disability: Benefits	12

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	3.14	Voluntary Termination by Employee and Termination for Cause: Benefits	13
	3.15	Termination Procedure	13
		A.     Notice of Termination	13
		B.     Date of Termination	13
		C.     Mitigation	13
4.	DIRECTOR POSITIONS		14
5.	NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY		14
	5.1	Non-Competition During Employment	14
	5.2	Conflicts of Interest	14
	5.3	Non-Competition After Termination	14
	5.4	Non-Solicitation of Customers	15
	5.5	Non-Solicitation of Employees	15
	5.6	Confidential Information	15
	5.7	Original Material	16
	5.8	Return of Documents, Equipment, Etc.	16
	5.9	Reaffirm Obligations	16
	5.10	Prior Disclosure	16
	5.11	Confidential Information of Prior Companies	17
	5.12	Rights Upon Breach	17
		(a)     Specific Performance	17
		(b)     Accounting	17
	5.13	Remedies For Violation of Non-Competition or Confidentiality Provisions	17
	5.14	Severability of Covenants	18
	5.15	Court Review	18
	5.16	Enforceability in Jurisdictions	18
	5.17	Extension of Post-Employment Restrictions	18
6.	INDEMNIFICATION		18
	6.1	General	18
	6.2	Expenses	19
	6.3	Enforcement	19
	6.4	Partial Indemnification	19
	6.5	Advances of Expenses	19
	6.6	Notice of Claim	19
	6.7	Defense of Claim	19
	6.8	Non-exclusivity	20
7.	LEGAL FEES AND EXPENSES		20
8.	BREACH		20
9.	RIGHT TO ENTER AGREEMENT		21

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10.	COMPLIANCE WITH SECTION 409A	21
	10.2     Certain Definitions	21
	10.3     Delay in Payments	21
	10.4     Reformation	22
11.	ENFORCEABILITY	22
12.	SURVIVABILITY	22
13.	ASSIGNMENT	22
14.	BINDING AGREEMENT	22
15.	NOTICES	22
16.	WAIVER	23
17.	SEVERABILITY	23
18.	ARBITRATION	23
19.	ENTIRE AGREEMENT	24
20.	SECTION HEADINGS	24
21.	MODIFICATION OF AGREEMENT	24
22.	UNDERSTANDING OF AGREEMENT	24
23.	GOVERNING LAW	24
24.	WITHHOLDING	24
25.	JURISDICTION AND VENUE	25
26.	NO PRESUMPTION AGAINST INTEREST	25

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EMPLOYMENT AND NON-COMPETITION AGREEMENT

This Employment and Non-Competition Agreement (“Agreement”) is entered into as of the 12^th day of June, 2008 (the “Effective Date”), between Vantage Drilling Company, a Cayman islands corporation (“Company”), and Douglas G. Smith (“Employee” or “Executive”).

RECITALS:

WHEREAS, Executive is to be employed as an integral part of its management who participates in the decision-making process relative to short and long-term planning and policy for the Company, will serve on the Company’s Executive Management Committee;

WHEREAS, the Company desires to obtain assurances from the Executive that he will devote his best efforts to the Company and will not enter into competition with the Company, solicit its customers, or solicit employees of the Company after termination of his employment;

WHEREAS, Executive will serve as a key employee with special and unique talents and skills of peculiar benefit and importance to the Company; and

WHEREAS, Executive is desirous of committing himself to serve on the terms herein provided; and

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below, the Parties agree as follows:

1.EMPLOYMENT TERM AND DUTIES

1.1Term of Employment.  Effective as of the Effective Date, the Company hereby agrees to employ Executive as its Chief Financial Officer, and Executive hereby agrees to accept such employment, on the terms and conditions set forth herein, for the period commencing on the Effective Date and expiring as of June 12, 2010 (the “Basic Term”) (unless sooner terminated as hereinafter set forth). The Basic Term shall be automatically extended for successive terms of one (1) year commencing on each Anniversary of the Effective Date thereafter (each such date being a “Renewal Date”), so as to terminate one (1) year from such Renewal Date, unless and until at least ninety (90) days prior to a Renewal Date either party hereto gives written notice to the other that the Term should not be further extended after the next Renewal Date (a “Notice of Non-Renewal”), in which event the Termination Date shall not be less than one (1) year following receipt of the Notice of Non-Renewal.

1.2Duties as Employee of the Company.  Executive shall, subject to the supervision of the Chief Executive Officer and Board, have general management and control of the Company’s finances in the ordinary course of its business with all such powers with respect to such management and control as may be reasonably incident to such responsibilities.  Executive shall devote his normal and regular business time, attention and skill to diligently attending to the business of the Company during the Basic Term. During the Basic Term, Executive shall not directly or indirectly render any services of a business, commercial, or professional nature to any

1

other person, firm, corporation, or organization, whether for compensation or otherwise, without the prior written consent of the Chairman of the Board.  Notwithstanding the foregoing, it shall not be a violation of the Agreement for Executive to (i) serve on corporate, civic or charitable boards or committees, (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, and (iii) manage personal investments so long as such activities do not materially interfere or conflict with the performance of his duties to the Company hereunder.  The conduct of such activity shall not be deemed to materially interfere or conflict with Executive’s performance of his duties until Executive has been notified in writing thereof and given a reasonable period in which to cure the same.

1.3Place of Performance.  During the Employment Period, the Company shall maintain its executive offices in Houston, Texas, and the Executive shall not be required to relocate to any other location.  During the Employment Period, the Company shall provide the Executive with an office and staff and other such facilities and services as shall be suitable to Executive’s position and adequate for the performance of Executive’s duties hereunder.

1.4Fiduciary Duty.  Executive acknowledges and agrees that he owes a fiduciary duty to the Company, and further agrees to make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not act for his own benefit concerning the subject matter of his fiduciary relationship.

1.5Compliance.  Executive agrees that he will not take any action which he knows would not comply with United States law as applicable to Executive’s employment, including, but without limitation to the Foreign Corrupt Practices Act.

2.COMPENSATION AND RELATED MATTERS

2.1Base Salary.  Executive shall receive a base salary (the “Base Salary”) paid by the Company at the annual rate of Two Hundred Seventy Five Thousand ($275,000.00) U.S., payable not less frequently than in substantially equal monthly installments, with the opportunity to increases, from time to time thereafter which are in accordance with the Company’s regular executive compensation practices.

2.2Bonus Payments.  For each full fiscal year of the Company that begins and ends during the Employment Period, and for the portion of the fiscal year of the Company that begins in 2008 (“Fiscal Year 2008”), the Executive shall be eligible to earn an annual cash bonus in such amount as shall be determined by the Compensation Committee of the Board (the “Compensation Committee”) (the “Annual Bonus”) based on the achievement by the Company of performance goals established by the Compensation Committee for each such fiscal year (or portion of Fiscal Year 2008).  The Compensation Committee shall establish objective criteria to be used to determine the extent to which performance goals have been satisfied.  For purposes of this Agreement, net earnings per share is defined as the Company’s consolidated net earnings per share as reported in the Company’s Annual Report on Form 10-K.  The Executive’s annual bonus potential target shall not be less than seventy percent (70%) of Base Salary.

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2.3Expenses.  During the Basic Term, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by him in accordance with the policies and procedures established by the Compensation Committee for the Company’s senior executive officers in performing services hereunder, provided that Executive properly accounts for such expenses in accordance with the Company’s policies and procedures.

2.4Automobiles.  The Company shall provide the Executive with an automobile allowance of $750.00 per month consistent with the practices of the Company.

2.5Business, Travel and Entertainment Expenses.  The Company shall promptly reimburse the Executive for all business, travel and entertainment expenses consistent with the Executive’s titles and the practices of the Company.

2.6Vacation.  The Executive shall be entitled to four (4) weeks of vacation per year. Vacation not taken during the applicable fiscal year (but not in excess of two (2) weeks) shall be carried over to the next following fiscal year.

2.7Welfare, Pension and Incentive Benefit Plans.  During the Employment Period, the Executive (and his eligible spouse and dependents) shall be entitled to participate in all the welfare benefit plans and programs maintained by the Company from time-to-time for the benefit of its senior executives including, without limitation, all medical, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs. In addition, during the Employment Period, the Executive shall be eligible to participate in all pension, retirement, savings and other employee benefit plans and programs maintained from time-to-time by the Company for the benefit of its senior executives, other than any annual cash incentive plan.

2.8Dues.  During the Employment Period, the Company shall pay or promptly reimburse the Executive for annual dues for membership in professional organizations relevant to Executive’s job responsibilities.

2.9Other Benefits.  Executive shall be entitled to participate in or receive benefits under any compensatory employee benefit plan or other arrangement made available by the Company now or in the future to its senior executive officers and key management employees, subject to and on a basis consistent with the terms, conditions, and overall administration of such plan or arrangement. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the Base Salary payable to Executive pursuant to Section 2.1 of this Agreement.  The Company shall not make any changes in any employee benefit plans or other arrangements in effect on the date hereof or subsequently in effect in which Executive currently or in the future participates (including, without limitation, each pension and retirement plan, supplemental pension and retirement plan, savings and profit sharing plan, stock or unit ownership plan, stock or unit purchase plan, stock or unit option plan, life insurance plan, medical insurance plan, disability plan, dental plan, health and accident plan, or any other similar plan or arrangement) that would adversely affect Executive’s rights or benefits thereunder, unless such change occurs pursuant to a program applicable to substantially all executives of the Company and does not result in a proportionately greater reduction in the

3

rights of or benefits to Executive as compared with any other executive of the Company.  The Company shall recommend that Executive receive an annual award of restricted stock and/or stock options in Vantage Drilling Company in the amount of approximately Seven Hundred Fifty Thousand Dollars ($750,000) based on market studies of industry executives, but Executive recognizes and agrees that future years could vary significantly as market conditions and industry compensation trends change.  If there is a Change of Control (as herein defined), any Stock Awards (as herein defined) which Executive has received under this Agreement shall vest immediately.

2.10Perquisites.  Executive shall be entitled to receive the perquisites and fringe benefits appertaining to an executive officer of the Company, in accordance with any practice established by the Compensation Committee.  In addition to the other benefits provided in this Agreement, Executive and his family shall be entitled to receive medical insurance as that may be provided under the Company’s group program, as such group program may be changed from time-to-time in the future, and Executive shall be entitled to continue to be covered by such group program or, if not permitted under the terms of the group program, then the Company shall provide Executive with a medical insurance policy providing substantially similar benefits as to the group program, for the period ending on the date of the later to die of Executive or, if Executive is married on the date of his death, Executive’s spouse.  Executive shall be entitled to receive the medical benefits defined herein at no cost to the Executive.  However, Executive’s rights pursuant to this subsection shall be void if Executive is terminated for Cause or if Executive voluntarily terminates his employment.

2.11Proration.  Any payments or benefits payable to Executive hereunder in respect of any calendar year during which Executive is employed by the Company for less than the entire year, unless otherwise provided in the applicable plan or arrangement, shall be prorated in accordance with the number of days in such calendar year during which he is so employed.

2.12Intentionally left blank.

2.13Additional Payments.

(a) Excise Tax; Gross-Up Payment.  Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by the Company to or for 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 under this Section (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (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, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise

4

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.

(b) Accounting Firm Determinations.  All determinations required to be made under this Section 2.13, including whether and when 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 a reputable accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (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. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting a Change of Control of the Company, the Executive shall appoint another reputable 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 Section, shall be paid by the Company to the Executive within five (5) days after 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 should have been made (an “Underpayment”), consistent with the calculations required to be made hereunder.  In the event that the Company exhausts its remedies pursuant to this Section and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment and any applicable penalty that has occurred and the amount of any such Underpayment and any applicable penalty shall be promptly paid by the Company to or for the benefit of the Executive.

(c) Notification of Claims.  The Executive shall notify the Company in writing of any claims by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as practicable but no later than thirty (30) days after the Executive actually receives notice 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 thirty (30) day period following the date on which the Executive 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:

1.give the Company any information reasonably requested by the Company relating to such claim;

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2.take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;

3.cooperate with the Company in good faith in order to effectively contest such claim; and

4.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 on the foregoing provisions of this Section, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego 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 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 further provided 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) Refund.  If, after the receipt by the Executive of an amount advanced by the Company pursuant to this Section, 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 this Section) 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 this Section, 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

6

thirty (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.

(e) Insurance.  The Company may, from time to time, apply for and take out, in its own name and at its own expense, naming itself or one or more of its affiliates as the designated beneficiary (which it may change from time to time), policies for life, health, accident, disability or other insurance upon the Executive in any amount or amounts that it may deem necessary or appropriate to protect its interest.  The Executive agrees to aid the Company in procuring such insurance by submitting to medical examinations and by completing, executing and delivering such applications and other instruments in writing as may reasonably be required by an insurance company or companies to which any application or applications for insurance may be made by or for the Company.

3.TERMINATION

3.1Definitions.

A.“Cause” shall mean:

(i) Material dishonesty which is not the result of an inadvertent or innocent mistake of Executive with respect to the Company or any of its subsidiaries;

(ii) Willful misfeasance or nonfeasance of duty by Executive intended to injure or having the effect of injuring in some material fashion the reputation, business, or business relationships of the Company or any of its subsidiaries or any of their respective officers, directors, or employees;

(iii)Material violation by Executive of any material term of this Agreement;

(iv)Conviction of Executive of any felony, any crime involving moral turpitude or any crime other than a vehicular offense which could reflect in some material fashion unfavorably upon the Company or any of its subsidiaries; or

(v) Violation of Sections 1.3 or 1.4 above.

3.1.2Notice to Cure.  Executive may not be terminated for Cause unless and until there has been delivered to Executive written notice from the Board supplying the particulars of Executive’s acts or omissions that the Board believes constitute Cause, a reasonable period of time (not less than 30 days) has been given to Executive after such notice to either cure the same or to meet with the Board, with his attorney if so desired by

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Executive, and following which the Board by action of not less than two-thirds of its members furnishes to Executive a written resolution specifying in detail its findings that Executive has been terminated for Cause as of the date set forth in the notice to Executive.

3.1.3A.For purposes of this Agreement, no act or failure to act by the Executive shall be considered “willful” if such act is done by the Executive in the good faith belief that such act is or was to be beneficial to the Company or one or more of its businesses, or such failure to act is due to the Executive’s good faith belief that such action would be materially harmful to the Company or one of its businesses.  Cause shall not exist unless and until the Company has delivered to the Executive a copy of a resolution duly adopted by a majority of the Board (excluding the Executive for purposes of determining such majority) at a meeting of the Board called and held for such purpose after reasonable (but in no event less than thirty days’) notice to the Executive and an opportunity for the Executive, together with his counsel, to be heard before the Board, finding that in the good faith opinion of the Board that “Cause” exists, and specifying the particulars thereof in detail.  This Section shall not prevent the Executive from challenging in an arbitration proceeding the Board’s determination that Cause exists or that the Executive has failed to cure any act (or failure to act) that purportedly formed the basis for the Board’s determination.

B.A “Change of Control” shall be deemed to have occurred if:

(i)A reverse merger involving the Company or the Parent in which the Company or the Parent, as the case may be, is the surviving corporation but the shares of common stock of the Company or the Parent (the “Common Stock”) outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise, and the shareholders of the Parent immediately prior to the completion of such transaction hold, directly or indirectly, less than fifty percent (50%) of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act, or comparable successor rules) of the surviving entity or, if more than one entity survives the transaction, the controlling entity; or

(ii)Any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of 50% or more of the Company’s then outstanding voting common stock; or

(iii)At any time during the period of three (3) consecutive years (not including any period prior to the date hereof), individuals who at the beginning of such period constituted the Board (and any new

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director whose election by the Board or whose nomination for election by the Company’s shareholders were approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority thereof; or

(iv)The shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation (a) in which a majority of the directors of the surviving entity were directors of the Company prior to such consolidation or merger, and (b) which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being changed into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation; or

(v)The shareholders approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

C.A “Disability” shall mean the absence of Executive from Executive’s duties with the Company on a full-time basis for 180 consecutive days, or 180 days in a 365-day period, as a result of incapacity due to mental or physical illness which results in the Executive being unable to perform the essential functions of his position, with or without reasonable accommodation.

D.A “Good Reason” shall mean any of the following (without Executive’s express written consent):

(i)Following a Change of Control, a material alteration in the nature or status of Executive’s title, duties or responsibilities, or the assignment of duties or responsibilities inconsistent with Executive’s status, title, duties and responsibilities;

(ii)A failure by the Company to continue in effect any employee benefit plan in which Executive was participating, or the taking of any action by the Company that would adversely affect Executive’s participation in, or materially reduce Executive’s benefits under, any such employee benefit plan, unless such failure or such taking of any action adversely affects the senior members of corporate management of the Company generally to the same extent;

(iii)A relocation of the Company’s principal offices, or Executive’s relocation to any place other than the principal executive

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offices, exceeding a distance of fifty (50) miles from the Company’s current executive office located in Houston, Texas, except for reasonably required travel by Executive on the Company’s business;

(iv)Any material breach by the Company of any provision of this Agreement;

(v)Any failure by the Company to obtain the assumption and performance of this Agreement by any successor (by merger, consolidation, or otherwise) or assign of the Company; or

(vi)The Company provides written notice of non-renewal to the Executive.

However, Good Reason shall exist with respect to an above specified matter only if such matter is not corrected by the Company within thirty (30) days of its receipt of written notice of such matter from Executive, and in no event shall a termination by Executive occurring more than ninety (90) days following the date of the event described above be a termination for Good reason due to such event.

3.2Termination Date.  “Termination Date” shall mean the date Executive is terminated for any reason pursuant to this Agreement.

3.3Constructive Termination Without Cause.  “Constructive Termination Without Cause” shall mean: Notwithstanding any other provision of this Agreement, the Executive’s employment under this Agreement may be terminated during the Term by the Executive, which shall be deemed to be constructive termination by the Company without Cause, if one of the following events shall occur without the written consent of the Executive: (i) a reduction in the Executive’s fixed salary; (ii) the failure of the Company to continue to provide the Executive with office space, related facilities and secretarial assistance that are commensurate with the Executive’s responsibilities to and position with the Company; (iii) the notification by the Company of the Company’s intention not to observe or perform one or more of the obligations of the Company under this Agreement; or (iv) the failure by the Company to indemnify, pay or reimburse the Executive at the time and under the circumstances required by this Agreement.  Any such termination pursuant to this Section shall be made by the Executive providing written notice to the Company specifying the event relied upon for such termination and given within sixty (60) days after such event.  Any constructive termination pursuant to this Section shall be effective sixty (60) days after the date the Executive has given the Company such written notice setting forth the grounds for such termination with specificity; provided, however, that the Executive shall not be entitled to terminate this Agreement in respect of any of the grounds set forth above if within sixty (60) days after such notice the action constituting such ground for termination has been cured and is no longer continuing.

3.4Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits.

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3.5Base Salary and Annual Bonus.  For a period of twenty four (24) months after the Termination Date, Base Salary and Annual Bonus (as such terms are defined herein) at the rate, and payable quarterly unless such termination is by the Company without Cause, in which even such amount of Base Salary and Annual Bonus shall be paid in a lump sum within ten (10) days of the Termination Event.

3.6Stock Awards.  If there is a Change of Control or if there is a Termination Event, any stock or stock option award issued pursuant to the 2007 Long Term Incentive Compensation Plan (“Stock Awards”) which Executive has received under this Agreement shall vest immediately and, if there is a Termination Event, all such Stock Awards shall be exercisable from the date of such Termination Event for the remainder of their term.

3.7Other Benefits.  To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other amounts or benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy or practice, or contract or agreement of the Company and its affiliated companies for the period of time equal to the remainder of the Basic Term (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).  Without limiting the preceding sentence and without limiting any other provision of this Agreement, through the remaining Basic Term, but under no condition less than one (1) year, the Company, at its sole expense, shall continue to provide (through its own plan and/or individual policies) Executive (and Executive’s dependents) with health benefits no less favorable than the group health plan benefits provided during such period to any senior executive officer of the Company or any affiliated company (to the extent any such coverage or benefits are taxable to Executive by reason of being provided under a self-insured health plan of the Company or an affiliate, the Company shall make Executive “whole” for the same on an after-tax basis).  In any event, the Other Benefits provided for pursuant to this Section shall be secondary to any benefits and coverage Executive (or his dependents) receive from another employer.

3.8Expenses.  All accrued compensation and unreimbursed expenses through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the Termination Date; and

3.9Mitigation.  Executive shall be free to accept other employment during such period, subject to the limitation as set forth in Section 5 of this Agreement and there shall be no offset of any employment compensation earned by Executive in such other employment during such period against payments due Executive under this Section 3, and there shall be no offset in any compensation received from such other employment against the Base Salary set forth above.

3.10 Maximum Payments.  It is the objective of this Agreement to maximize the Executive’s Net After-Tax Benefit (as defined herein) if payments or benefits provided under this Section are subject to excise tax under Section 4999 of the Code.  Therefore, in the event it is determined that any payment or benefit 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 Section or otherwise, including, by example and not by way of limitation, acceleration by the Company or otherwise of the date of vesting or payment or rate of payment under any plan, program or

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arrangement of the Company, would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties 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”), the Company shall first make a calculation under which such payments or benefits provided to the Executive under this Agreement are reduced to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code (the “4999 Limit”).  The Company shall then compare (x) the Executive’s Net After-Tax Benefit assuming application of  the 4999 Limit with (y) the Executive’s Net After-Tax Benefit without the application of the 4999 Limit and the Executive shall be entitled to the greater of (x) or (y).

3.11 Net After-Tax Benefit.  “Net After-Tax Benefit” shall mean the sum of (i) all payments and benefits which the Executive receives or is then entitled to receive from the Company, less (ii) the amount of federal income taxes payable with respect to the payments and benefits described in (i) above calculated at the maximum marginal income tax rate for each year in which such payments and benefits shall be paid to the Executive (based upon the rate for such year as set forth in the Code at the time of the first payment of the foregoing), less (iii) the amount of excise taxes imposed with respect to the payments and benefits described in (i) above by Section 4999 of the Code.  The determination of whether a payment or benefit constitutes an excess parachute payment shall be made by tax counsel selected by the Company and reasonably acceptable to the Executive. The costs of obtaining this determination shall be borne by the Company.

3.12 Termination In Event of Death: Benefits.  If Executive’s employment is terminated by reason of Executive’s death during the Basic Term, this Agreement shall terminate, except as provided herein, without further obligation to Executive’s legal representatives under this Agreement, other than for payment of all accrued compensation, unreimbursed expenses, the timely payment or provision of Other Benefits through the date of death, one (1) year’s Base Salary, and such cash or stock bonus as Executive would otherwise have been awarded in year if Executive’s death had not occurred.  Such amounts shall be paid to Executive’s estate or beneficiary, as applicable, in a lump sum in cash within ninety (90) days after the date of death.  With respect to the provision of Other Benefits, the term Other Benefits as used in this Section shall include, without limitation, and Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company to the estates and beneficiaries of other executive level employees of the Company under such plans, programs, practices, and policies relating to death benefits, if any, as in effect with respect to other executives and their beneficiaries at any time during the 120-day period immediately preceding the date of death.  Additionally, all Stock Awards shall be vested immediately and shall be exercisable for the greater of one year after the date of such vesting or the remaining term of such option.

3.13 Termination In Event of Disability: Benefits.  If Executive’s employment is terminated by reason of Executive’s Disability during the Basic Term, this Agreement shall continue in full force for a period of one (1) year following such Disability and if such Disability occurs on or after June 1 of any year Executive shall be entitled to the same cash or stock bonus in such year that Executive would have been awarded if such Disability had not occurred. In

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addition, all outstanding Stock Awards shall vest immediately upon such termination due to Disability.

3.14 Voluntary Termination by Employee and Termination for Cause: Benefits. Executive may terminate his employment with the Company without Good Reason by giving written notice of his intent and stating an effective Termination Date at least ninety (90) days after the date of such notice; provided, however, that the Company may accelerate such effective date by paying Executive through the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date.  Upon such a termination by Executive, except as provided in Section 5, or upon termination for Cause by the Company, this Agreement shall terminate and the Company shall pay to Executive all accrued compensation, unreimbursed expenses and the Other Benefits through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the date of termination.  In addition, all unvested stock options shall terminate and all vested options will terminate one hundred twenty (120) days after the Termination Date.

3.15 Termination Procedure.

A.Notice of Termination.  Any termination of the Executive’s employment by the Company or by the Executive during the Employment Period (other than pursuant to Section 3.5) shall be communicated by written Notice of Termination to the other party. For purposes of this Agreement, a “Notice of Termination” shall mean a notice indicating the specific termination provision in this Agreement relied upon and setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under that provision.

B.Date of Termination.  “Date of Termination” shall mean (i) if the Executive’s employment is terminated by his death, the date of his death, (ii) if the Executive’s employment is terminated pursuant to Section 3.13, thirty (30) days after the date of receipt of the Notice of Termination (provided that the Executive does not return to the substantial performance of his duties on a full-time basis during such thirty (30) day period), and (iii) if the Executive’s employment is terminated for any other reason, the date on which a Notice of Termination is given or any later date (within thirty (30) days after the giving of such notice) set forth in such Notice of Termination.

C.Mitigation.  The Executive shall not be required to mitigate damages with respect to the termination of his employment under this Agreement by seeking other employment or otherwise, and there shall be no offset against amounts due the Executive under this Agreement on account of subsequent employment except as specifically provided in this Agreement. Additionally, amounts owed to the Executive under this Agreement shall not be offset by any claims the Company may have against the Executive, and the Company’s obligation to make the payments provided for in this Agreement, and otherwise to perform its obligations hereunder, shall not be affected by any other circumstances, including, without limitation, any counterclaim, recoupment, defense or other right which the Company may have against the Executive or others.

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4.DIRECTOR POSITIONS

Executive agrees that upon termination of employment, for any reason, at the request of the Chairman of the Board, he will immediately tender his resignation from any and all Board positions held with the Company and/or any of its subsidiaries and affiliates. If Executive remains as a director, at the election of the Board, after such termination, Executive shall be compensated as an outside director.

5.NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY

The Company shall provide Executive with its trade secrets, goodwill, and confidential information of Company and contact with the Company’s customers and potential customers.  Executive also recognizes and agrees that the benefit of not being employed at-will, is provided in consideration for, among other things, the agreements contained in this Section, as well as the Stock Awards granted to Executive pursuant to this Agreement.  Executive agrees that the business of the Company is highly competitive and that the trade secrets, goodwill, and confidential information of the Company is of primary importance to the success of the Company.  In consideration of all of the foregoing, and in recognition of these conditions, and specifically for being provided trade secrets, goodwill, and confidential information, Executive agrees as follows:

5.1Non-Competition During Employment.  Executive agrees during the Basic Term he will not compete with the Company by engaging in the conception, design, development, production, marketing, or servicing of any product or service that is substantially similar to the products or services which the Company provides, and that he will not work for, in any capacity, assist, or became affiliated with as an owner, partner, etc., either directly or indirectly, any individual or business which offer or performs services, or offers or provides products substantially similar to the services and products provided by Company.

5.2Conflicts of Interest.  Executive agrees that during the Basic Term, he will not engage, either directly or indirectly, in any activity (a “Conflict of Interest”) which might adversely affect the Company or its affiliates, including ownership of a material interest in any supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business or accepting any material payment, service, loan, gift, trip, entertainment, or other favor from a supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business, and that Executive will promptly inform the Chairman of the Company as to each offer received by Executive to engage in any such activity. Executive further agrees to disclose to the Company any other facts of which Executive becomes aware which might in Executive’s good faith judgment reasonably be expected to involve or give rise to a Conflict of Interest or potential Conflict of Interest.

5.3Non-Competition After Termination.  In further consideration of the Company providing Employee confidential information, executive agrees that Executive shall not, at any time during the period of one (1) year after termination within the geographic area as

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defined by this Section 5 that the Company has sold products or services or formulated a plan to sell products or services into a market during the last twelve (12) months of Executive’s employ, engage in or contribute Executive’s knowledge to any work which is competitive with or similar to a product, process, apparatus, services, or development on which Executive worked or with respect to which Executive had access to Confidential Information while employed by the Company.  It is understood that the geographical area set forth in this covenant is divisible so that if this clause is invalid or unenforceable in an included geographic area, that area is severable and the clause remains in effect for the remaining included geographic areas in which the clause is valid. For purposes of this Section 5.3, the geographic area shall apply to the territory or country where the Company conducts operations.

5.4Non-Solicitation of Customers.  In further consideration of the Company providing Employees confidential information, Executive further agrees that for a period of one (1) year after termination, he will not solicit or accept any business from any customer or client or prospective customer or client with whom Executive dealt or solicited while employed by Company during the last twelve (12) a months of his employment.

5.5Non-Solicitation of Employees.  Executive agrees that for the duration of the Basic Term, and for a period of one (1) year after the termination of the Basic Term, he will not either directly or indirectly, on his own behalf or on behalf of others, solicit, attempt to hire, or hire any person employed by Company to work for Executive or for another entity, firm, corporation, or individual.

5.6Confidential Information.  Executive further agrees that he will not, except as the Company may otherwise consent or direct in writing, reveal or disclose, sell, use, lecture upon, publish or otherwise disclose to any third party any Confidential Information or proprietary information of the Company, or authorize anyone else to do these things at any time either during or subsequent to his employment with the Company.  This Section shall continue in full force and effect after termination of Executive’s employment and after the termination of this Agreement.  Executive shall continue to be obligated under the Confidential Information Section of this Agreement not to use or to disclose Confidential Information of the Company so long as it shall not be publicly available.  Executive’s obligations under this Section with respect to any specific Confidential Information and proprietary information shall cease when that specific portion of the Confidential Information and proprietary information becomes publicly known, in its entirety and without combining portions of such information obtained separately.  It is understood that such Confidential Information and proprietary information of the Company include matters that Executive conceives or develops, as well as matters Executive learns from other employees of Company. Confidential Information is defined to include information: (1) disclosed to or known by the Executive as a consequence of or through his employment with the Company; (2) not generally known outside the Company; and (3) which relates to any aspect of the Company or its business, finances, operation plans, budgets, research, or strategic development. “Confidential Information” includes, but is not limited to the Company’s trade secrets, proprietary information, financial documents, long range plans, customer lists, employer compensation, marketing strategy, data bases, costing data, computer software developed by the Company, investments made by the Company, and any information provided to the Company by a third party under restrictions against disclosure or use by the Company or others.

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5.7Original Material.  The Executive agrees that any inventions, discoveries, improvements, ideas, concepts or original works of authorship relating directly to the Company Business, including without limitation information of a technical or business nature such as ideas, discoveries, designs, inventions, improvements, trade secrets, know-how, manufacturing processes, product formulae, design specifications, writings and other works of authorship, computer programs, financial figures, marketing plans, customer lists and data, business plans or methods and the like, which relate in any manner to the actual or anticipated business or the actual or anticipated areas of research and development of the Company and its divisions and affiliates, whether or not protectable by patent or copyright, that have been originated, developed or reduced to practice by the Executive alone or jointly with others during the Executive’s employment with the Company shall be the property of and belong exclusively to the Company. The Executive shall promptly and fully disclose to the Company the origination or development by the Executive of any such material and shall provide the Company with any information that it may reasonably request about such material.  Either during the subsequent to the Executive’s employment, upon the request and at the expense of the Company or its nominee, and for no remuneration in addition to that due the Executive pursuant to the Executive’s employment by the Company, but at no expense to the Executive, the Executive agrees to execute, acknowledge, and deliver to the Company or its attorneys any and all instruments which, in the judgment of the Company or its attorneys, may be necessary or desirable to secure or maintain for the benefit of the Company adequate patent, copyright, and other property rights in the United States and foreign countries with respect to any such inventions, improvements, ideas, concepts, or original works of authorship embraced within this Agreement.

5.8Return of Documents, Equipment, Etc.  All writings, records, and other documents and things comprising, containing, describing, discussing, explaining, or evidencing any Confidential Information, and all equipment, components, parts, tools, and the like in Executive’s custody or possession that have been obtained or prepared in the course of Executive’s employment with the Company shall be the exclusive property of the Company, shall not be copied and/or removed from the premises of the Company, except in pursuit of the business of the Company, and shall be delivered to the Company, without Executive retaining any copies, upon notification of the termination of Executive’s employment or at any other time requested by the Company. The Company shall have the right to retain, access, and inspect all property of Executive of any kind in the office, work area, and on the premises of the Company upon termination of Executive’s employment and at any time during employment by the Company upon termination of Executive’s employment and at any time during employment by the Company to ensure compliance with the terms of this Agreement.

5.9Reaffirm Obligations.  Upon termination of his employment with the Company, Executive, if requested by Company, shall reaffirm in writing Executive’s recognition of the importance of maintaining the confidentiality of the Company’s Confidential Information and proprietary information, and reaffirm any other obligations set forth in this Agreement.

5.10 Prior Disclosure.  Executive represents and warrants that he has not used or disclosed any Confidential Information he may have obtained from Company prior to signing this Agreement, in any way inconsistent with the provisions of this Agreement.

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5.11 Confidential Information of Prior Companies.  Executive will not disclose or use during the period of his employment with the Company any proprietary or Confidential Information or Copyright Works which Executive may have acquired because of employment with an employer other than the Company or acquired from any other third party, whether such information is in Executive’s memory or embodied in a writing or other physical form

5.12 Rights Upon Breach.  If the Executive breaches, any of the provisions contained in Section 5 of this Agreement (the “Restrictive Covenants”), the Company shall have the following rights and remedies, each of which rights and remedies shall be independent of the others and severally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity:

(a)Specific Performance.  The right and remedy to have the Restrictive Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach of the Restrictive Covenants would cause irreparable injury to the Company and that money damages would not provide an adequate remedy to the Company.

(b)Accounting.  The right and remedy to require the Executive to account for and pay over to the Company all compensation, profits, monies, accruals, increments or other benefits derived or received by the Executive as the result of any action constituting a breach of the Restrictive Covenants.

5.13 Remedies For Violation of Non-Competition or Confidentiality Provisions. Without limiting the right of the Company to pursue all other legal and equitable rights available to it for violation of any of the obligations and covenants made by Employee herein, it is agreed that:

(a)the skills, experience and contacts of Employee are of a special, unique, unusual and extraordinary character which give them a peculiar value;

(b)because of the business of the Company, the restrictions agreed to by Employee as to time and area contained in the Agreement are reasonable; and

(c)the injury suffered by the Company by a violation of any obligation or covenant in the Agreement resulting from loss of profits created by (i) the competitive use of such skills, experience contacts and otherwise and/or (ii) the use or communication of any information deemed confidential herein will be difficult to calculate in damages in an action at law and cannot fully compensate the Company for any violation of any obligation or covenant in the Agreement, accordingly:

(i)the Company shall be entitled to injunctive relief to prevent violations thereof and prevent Employee from rendering any services to any person, firm or entity in breach of such obligation or covenant and to prevent Employee from divulging any confidential information; and

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(ii)compliance with the Agreement is a condition precedent to the Company’s obligation to make payments of any nature to employee, subject to the other provisions hereof.

(d)employee waives any objection to the enforceability of the restrictive covenants and agrees to be estopped from denying the legality and enforceability of these provisions.

5.14Severability of Covenants.  The Executive acknowledges and agrees that the Restrictive Covenants are reasonable and valid in duration and geographical scope and in all other respects.  If any court determines that any of the Restrictive Covenants, or any part thereof, is invalid or unenforceable, the remainder of the Restrictive Covenants shall not thereby be affected and shall be given full effect without regard to the invalid portions.

5.15Court Review.  If any court determines that any of the Restrictive Covenants, or any part thereof is unenforceable because of the duration or geographical scope of or scope of activities restrained by, such provision, such court shall have the power to reduce the duration or scope of such provision, as the case may be, and, in its reduced form, such provision shall then be enforceable.

5.16Enforceability in Jurisdictions.  The Company and the Executive intend to and hereby confer jurisdiction to enforce the Restrictive Covenants upon the courts of any jurisdiction within the geographical scope of such Restrictive Covenants.  If the courts of any one or more of such jurisdictions hold the Restrictive Covenants unenforceable by reason of the breadth of such scope or otherwise, it is the intention of the Company that such determination not bar or in any way affect the right of the Company to the relief provided above in the courts of any other jurisdiction within the geographical scope of such Restrictive Covenants, as to breaches of such Restrictive Covenants in such other respective jurisdictions, such Restrictive Covenants as they relate to each jurisdiction being, for this purpose, severable into diverse and independent covenants.

5.17Extension of Post-Employment Restrictions.  In the event Executive breaches Section 5 above, the restrictive time periods contained in those provisions will be extended by the period of time Executive was in violation of such provisions.

6.INDEMNIFICATION

6.1General.  The Company agrees that if the Executive is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”), by reason of the fact that the Executive is or was a trustee, director or officer of the Company, the Company, or any predecessor to the Company (including any sole proprietorship owned by the Executive) or any of their affiliates or is or was serving at the request of the Company, the Company, any predecessor to the Company (including any sole proprietorship owned by the Executive), or any of their affiliates as a trustee, director, officer, member, employee or agent of another corporation or a partnership, joint

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venture, limited liability company, trust or other enterprise, including, without limitation, service with respect to employee benefit plans, whether or not the basis of such Proceeding is alleged action in an official capacity as a trustee, director, officer, member, employee or agent while serving as a trustee, director, officer, member, employee or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by Texas law, as the same exists or may hereafter be amended, against all Expenses incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to the Executive even if the Executive has ceased to be an officer, director, trustee or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators.

6.2          Expenses.  As used in this Section, the term “Expenses” shall include, without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, and costs, attorneys’ fees, accountants’ fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing a right to indemnification under this Agreement.

6.3          Enforcement.  If a claim or request under this Section 6 is not paid by the Company or on its behalf, within thirty (30) days after a written claim or request has been received by the Company, the Executive may at any time thereafter bring an arbitration claim against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part, the Executive shall be entitled to be paid also the expenses of prosecuting such suit.  All obligations for indemnification hereunder shall be subject to, and paid in accordance with, applicable Texas law.

6.4          Partial Indemnification.  If the Executive is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify the Executive for the portion of such Expenses to which the Executive is entitled.

6.5          Advances of Expenses.  Expenses incurred by the Executive in connection with any Proceeding shall be paid by the Company in advance upon request of the Executive that the Company pay such Expenses, but only in the event that the Executive shall have delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect to which the Executive is not entitled to indemnification and (ii) a statement of his good faith belief that the standard of conduct necessary for indemnification by the Company has been met.

6.6          Notice of Claim.  The Executive shall give to the Company notice of any claim made against him for which indemnification will or could be sought under this Agreement.  In addition, the Executive shall give the Company such information and cooperation as it may reasonably require and as shall be within the Executive’s power and at such times and places as are convenient for the Executive.

6.7          Defense of Claim.  With respect to any Proceeding as to which the Executive notifies the Company of the commencement thereof:

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(a)             The Company will be entitled to participate therein at its own expense.

(b)             Except as otherwise provided below, to the extent that it may wish, the Company will be entitled to assume the defense thereof, with counsel reasonably satisfactory to the Executive, which in the Company’s sole discretion may be regular counsel to the Company and may be counsel to other officers and directors of the Company or any subsidiary.  The Executive also shall have the right to employ his own counsel in such action, suit or proceeding if he reasonably concludes that failure to do so would involve a conflict of interest between the Company and the Executive, and under such circumstances the fees and expenses of such counsel shall be at the expense of the Company.

(c)             The Company shall not be liable to indemnify the Executive under this Agreement for any amounts paid in settlement of any action or claim effected without its written consent.  The Company shall not settle any action or claim in any manner which would impose any penalty that would not be paid directly or indirectly by the Company or limitation on the Executive without the Executive’s written consent. Neither the Company nor the Executive will unreasonably withhold or delay their consent to any proposed settlement.

6.8          Non-exclusivity.  The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Section 6 shall not be exclusive of any other right which the Executive may have or hereafter may acquire under any statute or certificate of incorporation or by-laws of the Company or any subsidiary, agreement, vote of shareholders or disinterested directors or trustees or otherwise.

7.LEGAL FEES AND EXPENSES

If any contest or dispute shall arise between the Company and the Executive regarding any provision of this Agreement, the Company shall reimburse the Executive for all legal fees and expenses reasonably incurred by the Executive in connection with such contest or dispute, but only if the Executive prevails to a substantial extent with respect to the Executive’s claims brought and pursued in connection with such contest or dispute.  Such reimbursement shall be made as soon as practicable following the resolution of such contest or dispute (whether or not appealed) to the extent the Company receives reasonable written evidence of such fees and expenses. The Company shall advance the Executive reasonable attorney’s fees during any arbitration proceedings if brought by the Executive, up to but not to exceed Three Hundred Thousand Dollars ($300,000.00).

8.BREACH

Executive agrees that any breach of restrictive covenants above cannot be remedied solely by money damages, and that in addition to any other remedies Company may have, Company is entitled to obtain injunctive relief against Executive.  Nothing herein, however, shall be construed as limiting Company’s right to pursue any other available remedy at law or in

20

equity, including recovery of damages and termination of this Agreement and/or any payments that may be due pursuant to this Agreement.

9.RIGHT TO ENTER AGREEMENT

Executive represents and covenants to Company that he has full power and authority to enter into this Agreement and that the execution of this Agreement will not breach or constitute a default of any other agreement or contract to which he is a party or by which he is bound.

10.COMPLIANCE WITH SECTION 409A

10.1        It is the intention of the Company and the Executive that this Agreement not result in unfavorable tax consequences to the Executive under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).  The Company and the Executive acknowledge that Section 409A of the Code was enacted pursuant to the American Jobs Creation Act of 2004, generally effective with respect to amounts deferred after January 1, 2005, and only limited guidance has been issued by the Internal Revenue Service with respect to the application of Code Section 409A to certain arrangements, such as this Agreement.  The Internal Revenue Service has indicated that it will provide further guidance regarding interpretation and application of Section 409A of the Code during 2005. The Company and the Executive acknowledge further that the full effect of Section 409A of the Code on potential payments pursuant to this Agreement cannot be fully determined at the time that the Company and the Executive are entering into this Agreement. The Company and the Executive agree to work together in good faith in an effort to comply with Section 409A of the Code including, if necessary, amending the Agreement based on further guidance issued by the Internal Revenue Service from time to time, provided that the Company shall not be required to assume any increased economic burden.

10.2        Certain Definitions.  As used in this Agreement, the following terms have the following meanings unless the context otherwise requires:

(a)             “affiliate” means any person controlled by or under common control with the Company but shall not include any stockholder or director of the Company, as such.

(b)             “person” means any individual, corporation, partnership, limited liability company, firm, joint company, association, joint-stock company, trust, unincorporated organization, governmental or regulatory body or other entity.

10.3        Delay in Payments.  Notwithstanding anything to the contrary in this Agreement, (i) if upon the date of Executive’s termination of employment with the Company, Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or any regulations or Treasury guidance promulgated thereunder (the “Code”) and the deferral of any amounts otherwise payable under this Agreement as a result of Executive’s termination of employment is necessary in order to prevent any accelerated or additional tax to Executive under Code Section 409A, then the Company will defer the payment

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of any such amounts hereunder until the date that is six months following the date of Executive’s termination of employment with the Company, at which time any such delayed amounts will be paid to Executive in a single lump sum, with interest from the date otherwise payable at the prime rate as published in The Wall Street Journal on the date of Executive’s termination of employment with the Company, and (ii) if any other payments of money or other benefits due to Executive hereunder could cause the application of an accelerated or additional tax under Code Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Code Section 409A.

10.4        Reformation.  If any provision of this Agreement would cause Executive to occur any additional tax under Code Section 409A, the parties will in good faith attempt to reform the provision in a manner that maintains, to the extent possible, the original intent of the applicable provision without violating the provision of Code Section 409A.

11.ENFORCEABILITY

The agreements contained in the restrictive covenant provisions of this Agreement are independent of the other agreements contained herein.  Accordingly, failure of the Company to comply with any of its obligations outside of such Sections do not excuse Executive from complying with the agreements contained herein.

12.SURVIVABILITY

The agreements contained in Sections 5 shall survive the termination of this Agreement for any reason.

13.ASSIGNMENT

This Agreement cannot be assigned by Executive. The Company may assign this Agreement only to a successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and assets of the Company provided such successor expressly agrees in writing reasonably satisfactory to Executive to assume and 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 and assignment had taken place.  Failure of the Company to obtain such written agreement prior to the effectiveness of any such succession shall be a material breach of this Agreement.

14.BINDING AGREEMENT

Executive understands that his obligations under this Agreement are binding upon Executive’s heirs, successors, personal representatives, and legal representatives.

15.NOTICES

All notices pursuant to this Agreement shall be in writing and sent certified mail, return receipt requested, addressed as set forth below, or by delivering the same in person to such party,

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or by transmission by facsimile to the number set forth below.  Notice deposited in the manner described hereinabove, shall be effective upon deposit.  Notice given in any other manner shall be effective only if and when received:

If to Executive:

Douglas G. Smith

12223 Kimberly Lane

Houston, Texas 77024

If to Company:

with a copy (which shall not constitute notice) to:

Vantage Drilling Company

777 Post Oak Blvd., Suite 610

Houston, Texas 77056

16.WAIVER

No waiver by either party to this Agreement of any right to enforce any term or condition of this Agreement, or of any breach hereof shall be deemed a waiver of such right in the future or of any other right or remedy available under this Agreement.  The Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3.2 hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

17.SEVERABILITY

If any provision of this Agreement is determined to be void invalid, unenforceable, or against public policy, such provisions shall be deemed severable from the Agreement, and the remaining provisions of the Agreement will remain unaffected and in full force and effect.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

18.ARBITRATION< /h1>

In the event any dispute arises out of Executive’s employment with or by the Company, or separation/termination therefrom, whether as an employee, which cannot be resolved by the Parties to this Agreement, such dispute shall be submitted to final and binding arbitration.  The arbitration shall be conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA”).  If the Parties cannot agree on an arbitrator, a list of seven (7) arbitrators will be requested from AAA, and the arbitrator will be selected using alternate strikes with Executive striking firm. The cost of the

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arbitration will be borne solely by the Company.  Arbitration of such disputes is mandatory and in lieu of any and all civil causes of action and lawsuits either party may have against the other arising out of Executive’s employment with Company, or separation therefrom.  Such arbitration shall be held in Houston, Texas.  This provision shall not, however, preclude the Company from obtaining injunctive relief in any court of competent jurisdiction to enforce Section 5 of this Agreement.

19.ENTIRE AGREEMENT

The terms and provisions contained herein shall constitute the entire agreement between the parties with respect to Executive’s employment with Company during the time period covered by this Agreement. This Agreement replaces and supersedes any and all existing Agreements entered into between Executive and the Company relating generally to the same subject matter, if any, except the offer of employment to Executive, dated November 2, 2007, and shall be binding upon Executive’s heirs, executors, administrators, or other legal representatives or assigns.

20.SECTION HEADIN GS

The section headings in this Employment Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation.

21.MODIFICATION OF AGREEMENT

This Agreement may not be changed or modified or released or discharged or abandoned or otherwise terminated, in whole or in part, except by an instrument in writing signed by the Executive and an officer or other authorized executive of Company.

22.UNDERSTANDING OF AGREEMENT

Executive represents and warrants that he has read and understood each and every provision of this Agreement, and Executive understands that he has the right to obtain advice from legal counsel of choice, if necessary and desired, in order to interpret any and all provisions of this Agreement, and that Executive has freely and voluntarily entered into this Agreement.

23.GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

24.WITHHOLDING< /h1>

All payments hereunder shall be subject to any required withholding of Federal, state and local taxes pursuant to any applicable law or regulation.

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25.JURISDICTION AND VENUE

With respect to any litigation regarding this Agreement, Executive agrees to venue in the state or federal courts in Harris County, Texas and agrees to waive and does hereby waive any defenses and/or arguments based upon improper venue and/or lack of personal jurisdiction.  By entering into this Agreement, Executive agrees to personal jurisdiction in the state and federal courts in Harris County, Texas.

26.NO PRESUMPTION AGAINST INTEREST

This Agreement has been negotiated, drafted, edited and reviewed by the respective parties, and therefore, no provision arising directly or indirectly herefrom shall be construed against any party as being drafted by said party.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first above written.

EXECUTIVE

/s/ Douglas G. Smith
Douglas G. Smith
VANTAGE DRILLING COMPANY
By:	/s/ Paul A. Bragg
Name:			Paul A. Bragg
Title:		Chief Executive Officer

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EX-10.7

Exhibit 10.7

EMPLOYMENT AND NON-COMPETITION AGREEMENT

BETWEEN

VANTAGE INTERNATIONAL PAYROLL COMPANY PTE. LTD.

AND

MICHEL R.C. DERBYSHIRE

DATED JUNE 12, 2008

TABLE OF CONTENTS

					Page
1.	EMPLOYMENT TERM AND DUTIES
	1.1	Term of Employment			1
	1.2	Duties as Employee of the Company			1
	1.3	Place of Performance			2
	1.4	Fiduciary Duty			2
	1.5	Compliance			2
2.	COMPENSATION AND RELATED MATTERS
	2.1	Base Salary			2
	2.2	Bonus Payments			2
	2.3	Expenses			2
	2.4	Automobiles			2
	2.5	Business, Travel and Entertainment Expenses			2
	2.6	Vacation			3
	2.7	Welfare, Pension and Incentive Benefit Plans			3
	2.8	Dues			3
	2.9	Other Benefits			3
	2.10	Perquisites			3
	2.11	Proration			4
	2.12	Signing Bonus			4
	2.13	Additional Payments			4
		(a)	Excise Tax; Gross-Up Payment		4
		(b)	Accounting Firm Determinations		4
		(c)	Notification of Claims		5
		(d)	Refund		6
		(e)	Insurance		6
3.	TERMINATION
	3.1	Definitions			6
		3.1.2		Notice to Cure	7
	3.2	Termination Date			9
	3.3	Constructive Termination Without Cause			9
	3.4	Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits			9
	3.5	Base Salary			9
	3.6	Stock Awards			9
	3.7	Other Benefits			9
	3.8	Expenses			10
	3.9	Mitigation			10
	3.10	Maximum Payments			10
	3.11	Net After-Tax Benefit			10
	3.12	Termination In Event of Death: Benefits			10
	3.13	Termination In Event of Disability: Benefits			11

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	3.14	Voluntary Termination by Employee and Termination for Cause: Benefits		11
	3.15	Termination Procedure		11
		A.	Notice of Termination	11
		B.	Date of Termination	11
		C.	Mitigation	11
4.	DIRECTOR POSITIONS			12
5.	NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY
	5.1	Non-Competition During Employment		12
	5.2	Conflicts of Interest		12
	5.3	Non-Competition After Termination		12
	5.4	Non-Solicitation of Customers		13
	5.5	Non-Solicitation of Employees		13
	5.6	Confidential Information		13
	5.7	Original Material		13
	5.8	Return of Documents, Equipment, Etc.		14
	5.9	Reaffirm Obligations		14
	5.10	Prior Disclosure		14
	5.11	Confidential Information of Prior Companies		14
	5.12	Rights Upon Breach		14
		(a)	Specific Performance	14
		(b)	Accounting	15
	5.13	Remedies For Violation of Non-Competition or Confidentiality Provisions		15
	5.14	Severability of Covenants		16
	5.15	Court Review		16
	5.16	Enforceability in Jurisdictions		16
	5.17	Extension of Post-Employment Restrictions		16
6.	INDEMNIFICATION
	6.1	General		16
	6.2	Expenses		16
	6.3	Enforcement		17
	6.4	Partial Indemnification		17
	6.5	Advances of Expenses		17
	6.6	Notice of Claim		17
	6.7	Defense of Claim		17
	6.8	Non-exclusivity		17
7.	LEGAL FEES AND EXPENSES			18
8.	BREACH			18
9.	RIGHT TO ENTER AGREEMENT			18

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10.	COMPLIANCE WITH SECTION 409A
	10.2	Certain Definitions	18
	10.3	Delay in Payments	19
	10.4	Reformation	19
11.	ENFORCEABILITY		19
12.	SURVIVABILITY		19
13.	ASSIGNMENT		19
14.	BINDING AGREEMENT		19
15.	NOTICES		20
16.	WAIVER		20
17.	SEVERABILITY		20
18.	ARBITRATION		20
19.	ENTIRE AGREEMENT		21
20.	SECTION HEADINGS		21
21.	MODIFICATION OF AGREEMENT		21
22.	UNDERSTANDING OF AGREEMENT		21
23.	GOVERNING LAW		21
24.	WITHHOLDING		21
25.	JURISDICTION AND VENUE		21
26.	NO PRESUMPTION AGAINST INTEREST		22

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EMPLOYMENT AND NON-COMPETITION AGREEMENT

This Employment and Non-Competition Agreement (“Agreement”) is entered into as of the 12th day of June, 2008 (the “Effective Date”), between Vantage International Payroll Company Pte. Ltd., a Singapore company (“Company”), and Michel R.C. Derbyshire (“Employee” or “Executive”).

RECITALS:

WHEREAS, Executive is to be employed as an integral part of its management who participates in the decision-making process relative to short and long-term planning and policy for the Company, will serve on the Company’s Executive Management Committee;

WHEREAS, the Company desires to obtain assurances from the Executive that he will devote his best efforts to the Company and will not enter into competition with the Company, solicit its customers, or solicit employees of the Company after termination of his employment;

WHEREAS, Executive will serve as a key employee with special and unique talents and skills of peculiar benefit and importance to the Company; and

WHEREAS, Executive is desirous of committing himself to serve on the terms herein provided; and

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below, the Parties agree as follows:

1.                                        EMPLOYMENT TERM AND DUTIES

1.1          Term of Employment.  Effective as of the Effective Date, the Company hereby agrees to employ Executive as its Vice President - Marketing, and Executive hereby agrees to accept such employment, on the terms and conditions set forth herein, for the period commencing on the Effective Date and expiring as of June 12, 2010 (the “Basic Term”) (unless sooner terminated as hereinafter set forth). The Basic Term shall be automatically extended for successive terms of one (1) year commencing on each Anniversary of the Effective Date thereafter (each such date being a “Renewal Date”), so as to terminate one (1) year from such Renewal Date, unless and until at least ninety (90) days prior to a Renewal Date either party hereto gives written notice to the other that the Term should not be further extended after the next Renewal Date (a “Notice of Non-Renewal”), in which event the Termination Date shall not be less than one (1) year following receipt of the Notice of Non-Renewal.

1.2          Duties as Employee of the Company.  Executive shall, subject to the supervision of the Chief Executive Officer and Board, have general management and control of Marketing in the ordinary course of its business with all such powers with respect to such management and control as may be reasonably incident to such responsibilities.  Executive shall devote his normal and regular business time, attention and skill to diligently attending to the business of the Company during the Basic Term. During the Basic Term, Executive shall not directly or indirectly render any services of a business, commercial, or professional nature to any other person, firm, corporation, or organization, whether for compensation or otherwise, without the prior written consent of the Chairman of the Board.  Notwithstanding the foregoing, it shall not be a violation of the Agreement for Executive to (i) serve on corporate, civic or charitable boards or committees, (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, and (iii) manage personal investments so long as such activities do not materially interfere or

1

conflict with the performance of his duties to the Company hereunder.  The conduct of such activity shall not be deemed to materially interfere or conflict with Executive’s performance of his duties until Executive has been notified in writing thereof and given a reasonable period in which to cure the same.

1.3          Place of Performance.  During the Employment Period, the Company shall maintain its executive offices in Houston, Texas, but the Executive shall be located in other locations, as agreed between Executive and the Company.  During the Employment Period, the Company shall provide the Executive with an office and staff and other such facilities and services as shall be suitable to Executive’s position and adequate for the performance of Executive’s duties hereunder.

1.4          Fiduciary Duty.  Executive acknowledges and agrees that he owes a fiduciary duty to the Company, and further agrees to make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not act for his own benefit concerning the subject matter of his fiduciary relationship.

1.5          Compliance.  Executive agrees that he will not take any action which he knows would not comply with United States law as applicable to Executive’s employment, including, but without limitation to the Foreign Corrupt Practices Act.

2.                                      COMPENSATION AND RELATED MATTERS

2.1          Base Salary.  Executive shall receive a base salary (the “Base Salary”) paid by the Company at the annual rate of Two Hundred Seventy Five Thousand ($275,000.00) U.S., payable not less frequently than in substantially equal monthly installments, with the opportunity to increases, from time to time thereafter which are in accordance with the Company’s regular executive compensation practices.

2.2          Bonus Payments.  For each full fiscal year of the Company that begins and ends during the Employment Period, and for the portion of the fiscal year of the Company that begins in 2008 (“Fiscal Year 2008”), the Executive shall be eligible to earn an annual cash bonus in such amount as shall be determined by the Compensation Committee of the Board (the “Compensation Committee”) (the “Annual Bonus”) based on the achievement by the Company of performance goals established by the Compensation Committee for each such fiscal year (or portion of Fiscal Year 2008).  The Compensation Committee shall establish objective criteria to be used to determine the extent to which performance goals have been satisfied.  For purposes of this Agreement, net earnings per share is defined as the Company’s consolidated net earnings per share as reported in the Company’s Annual Report on Form 10-K.  The Executive’s annual bonus potential target shall not be less than seventy percent (70%) of Base Salary.

2.3          Expenses.  During the Basic Term, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by him in accordance with the policies and procedures established by the Compensation Committee for the Company’s senior executive officers in performing services hereunder, provided that Executive properly accounts for such expenses in accordance with the Company’s policies and procedures.

2.4          Automobiles.  The Company shall provide the Executive with an automobile provided by the Company, or, in the alternative, an automobile allowance consistent with the practices of the Company.

2.5          Business, Travel and Entertainment Expenses.  The Company shall promptly reimburse the Executive for all business, travel and entertainment expenses consistent with the Executive’s titles and the practices of the Company.

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2.6          Vacation.  The Executive shall be entitled to six (6) weeks of vacation per year. Vacation not taken during the applicable fiscal year (but not in excess of two (2) weeks) shall be carried over to the next following fiscal year.

2.7          Welfare, Pension and Incentive Benefit Plans.  During the Employment Period, the Executive (and his eligible spouse and dependents) shall be entitled to participate in all the welfare benefit plans and programs maintained by the Company from time-to-time for the benefit of its senior executives including, without limitation, all medical, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs. In addition, during the Employment Period, the Executive shall be eligible to participate in all pension, retirement, savings and other employee benefit plans and programs maintained from time-to-time by the Company for the benefit of its senior executives, other than any annual cash incentive plan.

2.8          Dues.  During the Employment Period, the Company shall pay or promptly reimburse the Executive for annual dues for membership in professional organizations relevant to Executive’s job responsibilities.

2.9          Other Benefits.  Executive shall be entitled to participate in or receive benefits under any compensatory employee benefit plan or other arrangement made available by the Company now or in the future to its senior executive officers and key management employees, subject to and on a basis consistent with the terms, conditions, and overall administration of such plan or arrangement. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the Base Salary payable to Executive pursuant to Section 2.1 of this Agreement.  The Company shall not make any changes in any employee benefit plans or other arrangements in effect on the date hereof or subsequently in effect in which Executive currently or in the future participates (including, without limitation, each pension and retirement plan, supplemental pension and retirement plan, savings and profit sharing plan, stock or unit ownership plan, stock or unit purchase plan, stock or unit option plan, life insurance plan, medical insurance plan, disability plan, dental plan, health and accident plan, or any other similar plan or arrangement) that would adversely affect Executive’s rights or benefits thereunder, unless such change occurs pursuant to a program applicable to substantially all executives of the Company and does not result in a proportionately greater reduction in the rights of or benefits to Executive as compared with any other executive of the Company.  The Company shall recommend that Executive receive an annual award of restricted stock and/or stock options in Vantage Drilling Company in the amount of approximately Seven Hundred Thousand Dollars ($700,000) based on market studies of industry executives, but Executive recognizes and agrees that future years could vary significantly as market conditions and industry compensation trends change.

2.10        Perquisites.  Executive shall be entitled to receive the perquisites and fringe benefits appertaining to an executive officer of the Company, in accordance with any practice established by the Compensation Committee.  In addition to the other benefits provided in this Agreement, Executive and his family shall be entitled to receive medical insurance as that may be provided under the Company’s group program, as such group program may be changed from time-to-time in the future, and Executive shall be entitled to continue to be covered by such group program or, if not permitted under the terms of the group program, then the Company shall provide Executive with a medical insurance policy providing substantially similar benefits as to the group program, for the period ending on the date of the later to die of Executive or, if Executive is married on the date of his death, Executive’s spouse.  Executive shall be entitled to receive the medical benefits defined herein at no cost to the Executive.  However, Executive’s rights pursuant to this subsection shall be void if Executive is terminated for Cause or if Executive voluntarily terminates his employment.

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2.11        Proration.  Any payments or benefits payable to Executive hereunder in respect of any calendar year during which Executive is employed by the Company for less than the entire year, unless otherwise provided in the applicable plan or arrangement, shall be prorated in accordance with the number of days in such calendar year during which he is so employed.

2.12        Signing Bonus.  Executive acknowledges receipt of a signing bonus in the amount of Twenty Thousand Dollars ($20,000.00) which was paid prior to the Effective Date upon commencement of his duties as Chief Operating Officer.

2.13        Additional Payments.

(a)           Excise Tax; Gross-Up Payment.  Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by the Company to or for 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 under this Section (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (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, without limitation, 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.

(b)           Accounting Firm Determinations.  All determinations required to be made under this Section 2.12, including whether and when 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 a reputable accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (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. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting a Change of Control of the Company, the Executive shall appoint another reputable 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 Section, shall be paid by the Company to the Executive within five (5) days after 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 should have been made (an “Underpayment”), consistent with the calculations required to be made hereunder.  In the event that the Company exhausts its remedies pursuant to this Section and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm

4

shall determine the amount of the Underpayment and any applicable penalty that has occurred and the amount of any such Underpayment and any applicable penalty shall be promptly paid by the Company to or for the benefit of the Executive.

(c)           Notification of Claims.  The Executive shall notify the Company in writing of any claims by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as practicable but no later than thirty (30) days after the Executive actually receives notice 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 thirty (30) day period following the date on which the Executive 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:

1.             give the Company any information reasonably requested by the Company relating to such claim;

2.             take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;

3.             cooperate with the Company in good faith in order to effectively contest such claim; and

4.             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 on the foregoing provisions of this Section, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego 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 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 further provided 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

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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)           Refund.  If, after the receipt by the Executive of an amount advanced by the Company pursuant to this Section, 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 this Section) 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 this Section, 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 thirty (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.

(e)           Insurance.  The Company may, from time to time, apply for and take out, in its own name and at its own expense, naming itself or one or more of its affiliates as the designated beneficiary (which it may change from time to time), policies for life, health, accident, disability or other insurance upon the Executive in any amount or amounts that it may deem necessary or appropriate to protect its interest.  The Executive agrees to aid the Company in procuring such insurance by submitting to medical examinations and by completing, executing and delivering such applications and other instruments in writing as may reasonably be required by an insurance company or companies to which any application or applications for insurance may be made by or for the Company.

3.                                      TERMINATION

3.1          Definitions.

A.	“Cause” shall mean:
	(i)	Material dishonesty which is not the result of an inadvertent or innocent mistake of Executive
with respect to the Company or any of its subsidiaries;
	(ii)	Willful misfeasance or nonfeasance of duty by Executive intended to injure or having the effect
of injuring in some material fashion the reputation, business, or business relationships of the Company or any of its subsidiaries or any of their respective officers, directors, or employees;
	(iii)	Material violation by Executive of any material term of this Agreement;
	(iv)	Conviction of Executive of any felony, any crime involving moral turpitude or any crime other
than a vehicular offense which could reflect in some material fashion unfavorably upon the Company or any of its subsidiaries; or
	(v)	Violation of Sections 1.3 or 1.4 above.

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3.1.2       Notice to Cure.  Executive may not be terminated for Cause unless and until there has been delivered to Executive written notice from the Board supplying the particulars of Executive’s acts or omissions that the Board believes constitute Cause, a reasonable period of time (not less than 30 days) has been given to Executive after such notice to either cure the same or to meet with the Board, with his attorney if so desired by Executive, and following which the Board by action of not less than two-thirds of its members furnishes to Executive a written resolution specifying in detail its findings that Executive has been terminated for Cause as of the date set forth in the notice to Executive.

3.1.3       For purposes of this Agreement, no act or failure to act by the Executive shall be considered “willful” if such act is done by the Executive in the good faith belief that such act is or was to be beneficial to the Company or one or more of its businesses, or such failure to act is due to the Executive’s good faith belief that such action would be materially harmful to the Company or one of its businesses.  Cause shall not exist unless and until the Company has delivered to the Executive a copy of a resolution duly adopted by a majority of the Board (excluding the Executive for purposes of determining such majority) at a meeting of the Board called and held for such purpose after reasonable (but in no event less than thirty days’) notice to the Executive and an opportunity for the Executive, together with his counsel, to be heard before the Board, finding that in the good faith opinion of the Board that “Cause” exists, and specifying the particulars thereof in detail.  This Section shall not prevent the Executive from challenging in an arbitration proceeding the Board’s determination that Cause exists or that the Executive has failed to cure any act (or failure to act) that purportedly formed the basis for the Board’s determination.

B.            A “Chance of Control” shall be deemed to have occurred if:

(i)            A reverse merger involving the Company or the Parent in which the Company or the Parent, as the case may be, is the surviving corporation but the shares of common stock of the Company or the Parent (the “Common Stock”) outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise, and the shareholders of the Parent immediately prior to the completion of such transaction hold, directly or indirectly, less than fifty percent (50%) of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act, or comparable successor rules) of the surviving entity or, if more than one entity survives the transaction, the controlling entity; or

(ii)           Any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of 50% or more of the Company’s then outstanding voting common stock; or

(iii)          At any time during the period of three (3) consecutive years (not including any period prior to the date hereof), individuals who at the beginning of such period constituted the Board (and any new director whose election by the Board or whose nomination for election by the Company’s shareholders were approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election or

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nomination for election was previously so approved) cease for any reason to constitute a majority thereof; or

(iv)          The shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation (a) in which a majority of the directors of the surviving entity were directors of the Company prior to such consolidation or merger, and (b) which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being changed into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation; or

(v)           The shareholders approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

C.            A “Disability” shall mean the absence of Executive from Executive’s duties with the Company on a full-time basis for 180 consecutive days, or 180 days in a 365-day period, as a result of incapacity due to mental or physical illness which results in the Executive being unable to perform the essential functions of his position, with or without reasonable accommodation.

D.            A “Good Reason” shall mean any of the following (without Executive’s express written consent):

(i)            Following a Change of Control, a material alteration in the nature or status of Executive’s title, duties or responsibilities, or the assignment of duties or responsibilities inconsistent with Executive’s status, title, duties and responsibilities;

(ii)           A failure by the Company to continue in effect any employee benefit plan in which Executive was participating, or the taking of any action by the Company that would adversely affect Executive’s participation in, or materially reduce Executive’s benefits under, any such employee benefit plan, unless such failure or such taking of any action adversely affects the senior members of corporate management of the Company generally to the same extent;

(iii)          Any material breach by the Company of any provision of this Agreement;

(iv)          Any failure by the Company to obtain the assumption and performance of this Agreement by any successor (by merger, consolidation, or otherwise) or assign of the Company; or

(v)           The Company provides written notice of non-renewal to the Executive.

However, Good Reason shall exist with respect to an above specified matter only if such matter is not corrected by the Company within thirty (30) days of its receipt of written notice of

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such matter from Executive, and in no event shall a termination by Executive occurring more than ninety (90) days following the date of the event described above be a termination for Good reason due to such event.

3.2          Termination Date.  “Termination Date” shall mean the date Executive is terminated for any reason pursuant to this Agreement.

3.3          Constructive Termination Without Cause.  “Constructive Termination Without Cause” shall mean: Notwithstanding any other provision of this Agreement, the Executive’s employment under this Agreement may be terminated during the Term by the Executive, which shall be deemed to be constructive termination by the Company without Cause, if one of the following events shall occur without the written consent of the Executive: (i) a reduction in the Executive’s fixed salary; (ii) the failure of the Company to continue to provide the Executive with office space, related facilities and secretarial assistance that are commensurate with the Executive’s responsibilities to and position with the Company; (iii) the notification by the Company of the Company’s intention not to observe or perform one or more of the obligations of the Company under this Agreement; or (iv) the failure by the Company to indemnify, pay or reimburse the Executive at the time and under the circumstances required by this Agreement.  Any such termination pursuant to this Section shall be made by the Executive providing written notice to the Company specifying the event relied upon for such termination and given within sixty (60) days after such event.  Any constructive termination pursuant to this Section shall be effective sixty (60) days after the date the Executive has given the Company such written notice setting forth the grounds for such termination with specificity; provided, however, that the Executive shall not be entitled to terminate this Agreement in respect of any of the grounds set forth above if within sixty (60) days after such notice the action constituting such ground for termination has been cured and is no longer continuing.

3.4          Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits.

3.5          Base Salary and Annual Bonus.  For a period of twelve (12) months after the Termination Date, Base Salary and Annual Bonus (as such terms are defined herein) at the rate, and payable quarterly unless such termination is by the Company without Cause, in which even such amount of Base Salary and Annual Bonus shall be paid in a lump sum within ten (10) days of the Termination Event.

3.6          Stock Awards.  If there is a Change of Control or if there is a Termination Event, any stock or stock option award issued pursuant to the 2007 Long Term Incentive Compensation Plan (“Stock Awards”) which Executive has received under this Agreement shall vest immediately and, if there is a Termination Event, all such Stock Awards shall be exercisable from the date of such Termination Event for the remainder of their term.

3.7          Other Benefits.  To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other amounts or benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy or practice, or contract or agreement of the Company and its affiliated companies for the period of time equal to the remainder of the Basic Term (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).  Without limiting the preceding sentence and without limiting any other provision of this Agreement, through the remaining Basic Term, but under no condition less than one (1) year, the Company, at its sole expense, shall continue to provide (through its own plan and/or individual policies) Executive (and Executive’s dependents) with health benefits no less favorable than the group health plan benefits provided during such period to any senior executive officer of the Company or any affiliated company (to the extent any

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such coverage or benefits are taxable to Executive by reason of being provided under a self-insured health plan of the Company or an affiliate, the Company shall make Executive “whole” for the same on an after-tax basis).  In any event, the Other Benefits provided for pursuant to this Section shall be secondary to any benefits and coverage Executive (or his dependents) receive from another employer.

3.8          Expenses.  All accrued compensation and unreimbursed expenses through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the Termination Date; and

3.9          Mitigation.  Executive shall be free to accept other employment during such period, subject to the limitation as set forth in Section 5 of this Agreement and there shall be no offset of any employment compensation earned by Executive in such other employment during such period against payments due Executive under this Section 3, and there shall be no offset in any compensation received from such other employment against the Base Salary set forth above.

3.10        Maximum Payments.  It is the objective of this Agreement to maximize the Executive’s Net After-Tax Benefit (as defined herein) if payments or benefits provided under this Section are subject to excise tax under Section 4999 of the Code.  Therefore, in the event it is determined that any payment or benefit 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 Section or otherwise, including, by example and not by way of limitation, acceleration by the Company or otherwise of the date of vesting or payment or rate of payment under any plan, program or arrangement of the Company, would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties 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”), the Company shall first make a calculation under which such payments or benefits provided to the Executive under this Agreement are reduced to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code (the “4999 Limit”).  The Company shall then compare (x) the Executive’s Net After-Tax Benefit assuming application of  the 4999 Limit with (y) the Executive’s Net After-Tax Benefit without the application of the 4999 Limit and the Executive shall be entitled to the greater of (x) or (y).

3.11        Net After-Tax Benefit.  “Net After-Tax Benefit” shall mean the sum of (i) all payments and benefits which the Executive receives or is then entitled to receive from the Company, less (ii) the amount of federal income taxes payable with respect to the payments and benefits described in (i) above calculated at the maximum marginal income tax rate for each year in which such payments and benefits shall be paid to the Executive (based upon the rate for such year as set forth in the Code at the time of the first payment of the foregoing), less (iii) the amount of excise taxes imposed with respect to the payments and benefits described in (i) above by Section 4999 of the Code.  The determination of whether a payment or benefit constitutes an excess parachute payment shall be made by tax counsel selected by the Company and reasonably acceptable to the Executive. The costs of obtaining this determination shall be borne by the Company.

3.12        Termination In Event of Death: Benefits.  If Executive’s employment is terminated by reason of Executive’s death during the Basic Term, this Agreement shall terminate, except as provided herein, without further obligation to Executive’s legal representatives under this Agreement, other than for payment of all accrued compensation, unreimbursed expenses, the timely payment or provision of Other Benefits through the date of death, one (1) year’s Base Salary, and such cash or stock bonus as Executive would otherwise have been awarded in year if Executive’s death had not occurred.  Such amounts shall be paid to Executive’s estate or beneficiary, as applicable, in a lump sum in cash within ninety (90) days after the date of death.  With respect to the provision of Other Benefits, the term Other

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Benefits as used in this Section shall include, without limitation, and Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company to the estates and beneficiaries of other executive level employees of the Company under such plans, programs, practices, and policies relating to death benefits, if any, as in effect with respect to other executives and their beneficiaries at any time during the 120-day period immediately preceding the date of death.  Additionally, all Stock Awards shall be vested immediately and shall be exercisable for the greater of one year after the date of such vesting or the remaining term of such option.

3.13        Termination In Event of Disability: Benefits.  If Executive’s employment is terminated by reason of Executive’s Disability during the Basic Term, this Agreement shall continue in full force for a period of one (1) year following such Disability and if such Disability occurs on or after January 1 of any year Executive shall be entitled to the same cash or stock bonus in such year that Executive would have been awarded if such Disability had not occurred. In addition, all outstanding Stock Awards shall vest immediately upon such termination due to Disability.

3.14        Voluntary Termination by Employee and Termination for Cause: Benefits. Executive may terminate his employment with the Company without Good Reason by giving written notice of his intent and stating an effective Termination Date at least ninety (90) days after the date of such notice; provided, however, that the Company may accelerate such effective date by paying Executive through the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date.  Upon such a termination by Executive, except as provided in Section 5, or upon termination for Cause by the Company, this Agreement shall terminate and the Company shall pay to Executive all accrued compensation, unreimbursed expenses and the Other Benefits through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the date of termination.  In addition, all unvested stock options shall terminate and all vested options will terminate one hundred twenty (120) days after the Termination Date.

3.15        Termination Procedure.

A.            Notice of Termination.  Any termination of the Executive’s employment by the Company or by the Executive during the Employment Period (other than pursuant to Section 3.5) shall be communicated by written Notice of Termination to the other party. For purposes of this Agreement, a “Notice of Termination” shall mean a notice indicating the specific termination provision in this Agreement relied upon and setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under that provision.

B.            Date of Termination.  “Date of Termination” shall mean (i) if the Executive’s employment is terminated by his death, the date of his death, (ii) if the Executive’s employment is terminated pursuant to Section 3.13, thirty (30) days after the date of receipt of the Notice of Termination (provided that the Executive does not return to the substantial performance of his duties on a full-time basis during such thirty (30) day period), and (iii) if the Executive’s employment is terminated for any other reason, the date on which a Notice of Termination is given or any later date (within thirty (30) days after the giving of such notice) set forth in such Notice of Termination.

C.            Mitigation.  The Executive shall not be required to mitigate damages with respect to the termination of his employment under this Agreement by seeking other employment or otherwise, and there shall be no offset against amounts due the Executive under this Agreement

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on account of subsequent employment except as specifically provided in this Agreement. Additionally, amounts owed to the Executive under this Agreement shall not be offset by any claims the Company may have against the Executive, and the Company’s obligation to make the payments provided for in this Agreement, and otherwise to perform its obligations hereunder, shall not be affected by any other circumstances, including, without limitation, any counterclaim, recoupment, defense or other right which the Company may have against the Executive or others.

4.                                      DIRECTOR POSITIONS

Executive agrees that upon termination of employment, for any reason, at the request of the Chairman of the Board, he will immediately tender his resignation from any and all Board positions held with the Company and/or any of its subsidiaries and affiliates. If Executive remains as a director, at the election of the Board, after such termination, Executive shall be compensated as an outside director.

5.                                      NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY

The Company shall provide Executive with its trade secrets, goodwill, and confidential information of Company and contact with the Company’s customers and potential customers.  Executive also recognizes and agrees that the benefit of not being employed at-will, is provided in consideration for, among other things, the agreements contained in this Section, as well as the Stock Awards granted to Executive pursuant to this Agreement.  Executive agrees that the business of the Company is highly competitive and that the trade secrets, goodwill, and confidential information of the Company is of primary importance to the success of the Company.  In consideration of all of the foregoing, and in recognition of these conditions, and specifically for being provided trade secrets, goodwill, and confidential information, Executive agrees as follows:

5.1          Non-Competition During Employment.  Executive agrees during the Basic Term he will not compete with the Company by engaging in the conception, design, development, production, marketing, or servicing of any product or service that is substantially similar to the products or services which the Company provides, and that he will not work for, in any capacity, assist, or became affiliated with as an owner, partner, etc., either directly or indirectly, any individual or business which offer or performs services, or offers or provides products substantially similar to the services and products provided by Company.

5.2          Conflicts of Interest.  Executive agrees that during the Basic Term, he will not engage, either directly or indirectly, in any activity (a “Conflict of Interest”) which might adversely affect the Company or its affiliates, including ownership of a material interest in any supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business or accepting any material payment, service, loan, gift, trip, entertainment, or other favor from a supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business, and that Executive will promptly inform the Chairman of the Company as to each offer received by Executive to engage in any such activity. Executive further agrees to disclose to the Company any other facts of which Executive becomes aware which might in Executive’s good faith judgment reasonably be expected to involve or give rise to a Conflict of Interest or potential Conflict of Interest.

5.3          Non-Competition After Termination.  In further consideration of the Company providing Employee confidential information, executive agrees that Executive shall not, at any time during the period of one (1) year after termination within the geographic area as defined by this Section 5 that the Company has sold products or services or formulated a plan to sell products or services into a

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market during the last twelve (12) months of Executive’s employ, engage in or contribute Executive’s knowledge to any work which is competitive with or similar to a product, process, apparatus, services, or development on which Executive worked or with respect to which Executive had access to Confidential Information while employed by the Company.  It is understood that the geographical area set forth in this covenant is divisible so that if this clause is invalid or unenforceable in an included geographic area, that area is severable and the clause remains in effect for the remaining included geographic areas in which the clause is valid. For purposes of this Section 5.3, the geographic area shall apply to the territory or country where the Company conducts operations.

5.4          Non-Solicitation of Customers.  In further consideration of the Company providing Employees confidential information, Executive further agrees that for a period of one (1) year after termination, he will not solicit or accept any business from any customer or client or prospective customer or client with whom Executive dealt or solicited while employed by Company during the last twelve (12) a months of his employment.

5.5          Non-Solicitation of Employees.  Executive agrees that for the duration of the Basic Term, and for a period of one (1) year after the termination of the Basic Term, he will not either directly or indirectly, on his own behalf or on behalf of others, solicit, attempt to hire, or hire any person employed by Company to work for Executive or for another entity, firm, corporation, or individual.

5.6          Confidential Information.  Executive further agrees that he will not, except as the Company may otherwise consent or direct in writing, reveal or disclose, sell, use, lecture upon, publish or otherwise disclose to any third party any Confidential Information or proprietary information of the Company, or authorize anyone else to do these things at any time either during or subsequent to his employment with the Company.  This Section shall continue in full force and effect after termination of Executive’s employment and after the termination of this Agreement.  Executive shall continue to be obligated under the Confidential Information Section of this Agreement not to use or to disclose Confidential Information of the Company so long as it shall not be publicly available.  Executive’s obligations under this Section with respect to any specific Confidential Information and proprietary information shall cease when that specific portion of the Confidential Information and proprietary information becomes publicly known, in its entirety and without combining portions of such information obtained separately.  It is understood that such Confidential Information and proprietary information of the Company include matters that Executive conceives or develops, as well as matters Executive learns from other employees of Company. Confidential Information is defined to include information: (1) disclosed to or known by the Executive as a consequence of or through his employment with the Company; (2) not generally known outside the Company; and (3) which relates to any aspect of the Company or its business, finances, operation plans, budgets, research, or strategic development. “Confidential Information” includes, but is not limited to the Company’s trade secrets, proprietary information, financial documents, long range plans, customer lists, employer compensation, marketing strategy, data bases, costing data, computer software developed by the Company, investments made by the Company, and any information provided to the Company by a third party under restrictions against disclosure or use by the Company or others.

5.7          Original Material.  The Executive agrees that any inventions, discoveries, improvements, ideas, concepts or original works of authorship relating directly to the Company Business, including without limitation information of a technical or business nature such as ideas, discoveries, designs, inventions, improvements, trade secrets, know-how, manufacturing processes, product formulae, design specifications, writings and other works of authorship, computer programs, financial figures, marketing plans, customer lists and data, business plans or methods and the like, which relate in any manner to the actual or anticipated business or the actual or anticipated areas of research and development

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of the Company and its divisions and affiliates, whether or not protectable by patent or copyright, that have been originated, developed or reduced to practice by the Executive alone or jointly with others during the Executive’s employment with the Company shall be the property of and belong exclusively to the Company. The Executive shall promptly and fully disclose to the Company the origination or development by the Executive of any such material and shall provide the Company with any information that it may reasonably request about such material.  Either during the subsequent to the Executive’s employment, upon the request and at the expense of the Company or its nominee, and for no remuneration in addition to that due the Executive pursuant to the Executive’s employment by the Company, but at no expense to the Executive, the Executive agrees to execute, acknowledge, and deliver to the Company or its attorneys any and all instruments which, in the judgment of the Company or its attorneys, may be necessary or desirable to secure or maintain for the benefit of the Company adequate patent, copyright, and other property rights in the United States and foreign countries with respect to any such inventions, improvements, ideas, concepts, or original works of authorship embraced within this Agreement.

5.8          Return of Documents, Equipment, Etc.  All writings, records, and other documents and things comprising, containing, describing, discussing, explaining, or evidencing any Confidential Information, and all equipment, components, parts, tools, and the like in Executive’s custody or possession that have been obtained or prepared in the course of Executive’s employment with the Company shall be the exclusive property of the Company, shall not be copied and/or removed from the premises of the Company, except in pursuit of the business of the Company, and shall be delivered to the Company, without Executive retaining any copies, upon notification of the termination of Executive’s employment or at any other time requested by the Company. The Company shall have the right to retain, access, and inspect all property of Executive of any kind in the office, work area, and on the premises of the Company upon termination of Executive’s employment and at any time during employment by the Company upon termination of Executive’s employment and at any time during employment by the Company to ensure compliance with the terms of this Agreement.

5.9          Reaffirm Obligations.  Upon termination of his employment with the Company, Executive, if requested by Company, shall reaffirm in writing Executive’s recognition of the importance of maintaining the confidentiality of the Company’s Confidential Information and proprietary information, and reaffirm any other obligations set forth in this Agreement.

5.10        Prior Disclosure.  Executive represents and warrants that he has not used or disclosed any Confidential Information he may have obtained from Company prior to signing this Agreement, in any way inconsistent with the provisions of this Agreement.

5.11        Confidential Information of Prior Companies.  Executive will not disclose or use during the period of his employment with the Company any proprietary or Confidential Information or Copyright Works which Executive may have acquired because of employment with an employer other than the Company or acquired from any other third party, whether such information is in Executive’s memory or embodied in a writing or other physical form

5.12        Rights Upon Breach.  If the Executive breaches, any of the provisions contained in Section 5 of this Agreement (the “Restrictive Covenants”), the Company shall have the following rights and remedies, each of which rights and remedies shall be independent of the others and severally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity:

(a)           Specific Performance.  The right and remedy to have the Restrictive Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach of the

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Restrictive Covenants would cause irreparable injury to the Company and that money damages would not provide an adequate remedy to the Company.

(b)           Accounting.  The right and remedy to require the Executive to account for and pay over to the Company all compensation, profits, monies, accruals, increments or other benefits derived or received by the Executive as the result of any action constituting a breach of the Restrictive Covenants.

5.13        Remedies For Violation of Non-Competition or Confidentiality Provisions. Without limiting the right of the Company to pursue all other legal and equitable rights available to it for violation of any of the obligations and covenants made by Employee herein, it is agreed that:

(a)           the skills, experience and contacts of Employee are of a special, unique, unusual and extraordinary character which give them a peculiar value;

(b)           because of the business of the Company, the restrictions agreed to by Employee as to time and area contained in the Agreement are reasonable; and

(c)           the injury suffered by the Company by a violation of any obligation or covenant in the Agreement resulting from loss of profits created by (i) the competitive use of such skills, experience contacts and otherwise and/or (ii) the use or communication of any information deemed confidential herein will be difficult to calculate in damages in an action at law and cannot fully compensate the Company for any violation of any obligation or covenant in the Agreement, accordingly:

(i)            the Company shall be entitled to injunctive relief to prevent violations thereof and prevent Employee from rendering any services to any person, firm or entity in breach of such obligation or covenant and to prevent Employee from divulging any confidential information; and

(ii)           compliance with the Agreement is a condition precedent to the Company’s obligation to make payments of any nature to employee, subject to the other provisions hereof.

(d)           employee waives any objection to the enforceability of the restrictive covenants and agrees to be estopped from denying the legality and enforceability of these provisions.

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5.14        Severability of Covenants.  The Executive acknowledges and agrees that the Restrictive Covenants are reasonable and valid in duration and geographical scope and in all other respects.  If any court determines that any of the Restrictive Covenants, or any part thereof, is invalid or unenforceable, the remainder of the Restrictive Covenants shall not thereby be affected and shall be given full effect without regard to the invalid portions.

5.15        Court Review.  If any court determines that any of the Restrictive Covenants, or any part thereof is unenforceable because of the duration or geographical scope of or scope of activities restrained by, such provision, such court shall have the power to reduce the duration or scope of such provision, as the case may be, and, in its reduced form, such provision shall then be enforceable.

5.16        Enforceability in Jurisdictions.  The Company and the Executive intend to and hereby confer jurisdiction to enforce the Restrictive Covenants upon the courts of any jurisdiction within the geographical scope of such Restrictive Covenants.  If the courts of any one or more of such jurisdictions hold the Restrictive Covenants unenforceable by reason of the breadth of such scope or otherwise, it is the intention of the Company that such determination not bar or in any way affect the right of the Company to the relief provided above in the courts of any other jurisdiction within the geographical scope of such Restrictive Covenants, as to breaches of such Restrictive Covenants in such other respective jurisdictions, such Restrictive Covenants as they relate to each jurisdiction being, for this purpose, severable into diverse and independent covenants.

5.17        Extension of Post-Employment Restrictions.  In the event Executive breaches Section 5 above, the restrictive time periods contained in those provisions will be extended by the period of time Executive was in violation of such provisions.

6.                                      INDEMNIFICATION

6.1          General.  The Company agrees that if the Executive is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”), by reason of the fact that the Executive is or was a trustee, director or officer of the Company, the Company, or any predecessor to the Company (including any sole proprietorship owned by the Executive) or any of their affiliates or is or was serving at the request of the Company, the Company, any predecessor to the Company (including any sole proprietorship owned by the Executive), or any of their affiliates as a trustee, director, officer, member, employee or agent of another corporation or a partnership, joint venture, limited liability company, trust or other enterprise, including, without limitation, service with respect to employee benefit plans, whether or not the basis of such Proceeding is alleged action in an official capacity as a trustee, director, officer, member, employee or agent while serving as a trustee, director, officer, member, employee or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by Texas or Delaware law, as the same exists or may hereafter be amended, against all Expenses incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to the Executive even if the Executive has ceased to be an officer, director, trustee or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators.

6.2          Expenses.  As used in this Section, the term “Expenses” shall include, without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, and costs, attorneys’ fees, accountants’ fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing a right to indemnification under this Agreement.

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6.3          Enforcement.  If a claim or request under this Section 6 is not paid by the Company or on its behalf, within thirty (30) days after a written claim or request has been received by the Company, the Executive may at any time thereafter bring an arbitration claim against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part, the Executive shall be entitled to be paid also the expenses of prosecuting such suit.  All obligations for indemnification hereunder shall be subject to, and paid in accordance with, applicable Texas or Delaware law.

6.4          Partial Indemnification.  If the Executive is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify the Executive for the portion of such Expenses to which the Executive is entitled.

6.5          Advances of Expenses.  Expenses incurred by the Executive in connection with any Proceeding shall be paid by the Company in advance upon request of the Executive that the Company pay such Expenses, but only in the event that the Executive shall have delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect to which the Executive is not entitled to indemnification and (ii) a statement of his good faith belief that the standard of conduct necessary for indemnification by the Company has been met.

6.6          Notice of Claim.  The Executive shall give to the Company notice of any claim made against him for which indemnification will or could be sought under this Agreement.  In addition, the Executive shall give the Company such information and cooperation as it may reasonably require and as shall be within the Executive’s power and at such times and places as are convenient for the Executive.

6.7          Defense of Claim.  With respect to any Proceeding as to which the Executive notifies the Company of the commencement thereof:

(a)           The Company will be entitled to participate therein at its own expense.

(b)           Except as otherwise provided below, to the extent that it may wish, the Company will be entitled to assume the defense thereof, with counsel reasonably satisfactory to the Executive, which in the Company’s sole discretion may be regular counsel to the Company and may be counsel to other officers and directors of the Company or any subsidiary.  The Executive also shall have the right to employ his own counsel in such action, suit or proceeding if he reasonably concludes that failure to do so would involve a conflict of interest between the Company and the Executive, and under such circumstances the fees and expenses of such counsel shall be at the expense of the Company.

(c)           The Company shall not be liable to indemnify the Executive under this Agreement for any amounts paid in settlement of any action or claim effected without its written consent.  The Company shall not settle any action or claim in any manner which would impose any penalty that would not be paid directly or indirectly by the Company or limitation on the Executive without the Executive’s written consent. Neither the Company nor the Executive will unreasonably withhold or delay their consent to any proposed settlement.

6.8          Non-exclusivity.  The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Section 6 shall not be exclusive of any other right which the Executive may have or hereafter may acquire under any statute or certificate of incorporation or by-laws of the Company or any subsidiary, agreement, vote of shareholders or disinterested directors or trustees or otherwise.

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7.                                      LEGAL FEES AND EXPENSES

If any contest or dispute shall arise between the Company and the Executive regarding any provision of this Agreement, the Company shall reimburse the Executive for all legal fees and expenses reasonably incurred by the Executive in connection with such contest or dispute, but only if the Executive prevails to a substantial extent with respect to the Executive’s claims brought and pursued in connection with such contest or dispute.  Such reimbursement shall be made as soon as practicable following the resolution of such contest or dispute (whether or not appealed) to the extent the Company receives reasonable written evidence of such fees and expenses. The Company shall advance the Executive reasonable attorney’s fees during any arbitration proceedings if brought by the Executive, up to but not to exceed Three Hundred Thousand Dollars ($300,000.00).

8.                                      BREACH

Executive agrees that any breach of restrictive covenants above cannot be remedied solely by money damages, and that in addition to any other remedies Company may have, Company is entitled to obtain injunctive relief against Executive.  Nothing herein, however, shall be construed as limiting Company’s right to pursue any other available remedy at law or in equity, including recovery of damages and termination of this Agreement and/or any payments that may be due pursuant to this Agreement.

9.                                      RIGHT TO ENTER AGREEMENT

Executive represents and covenants to Company that he has full power and authority to enter into this Agreement and that the execution of this Agreement will not breach or constitute a default of any other agreement or contract to which he is a party or by which he is bound.

10.                                    COMPLIANCE WITH SECTION 409A

10.1        It is the intention of the Company and the Executive that this Agreement not result in unfavorable tax consequences to the Executive under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).  The Company and the Executive acknowledge that Section 409A of the Code was enacted pursuant to the American Jobs Creation Act of 2004, generally effective with respect to amounts deferred after January 1, 2005, and only limited guidance has been issued by the Internal Revenue Service with respect to the application of Code Section 409A to certain arrangements, such as this Agreement.  The Internal Revenue Service has indicated that it will provide further guidance regarding interpretation and application of Section 409A of the Code during 2005. The Company and the Executive acknowledge further that the full effect of Section 409A of the Code on potential payments pursuant to this Agreement cannot be fully determined at the time that the Company and the Executive are entering into this Agreement. The Company and the Executive agree to work together in good faith in an effort to comply with Section 409A of the Code including, if necessary, amending the Agreement based on further guidance issued by the Internal Revenue Service from time to time, provided that the Company shall not be required to assume any increased economic burden.

10.2        Certain Definitions.  As used in this Agreement, the following terms have the following meanings unless the context otherwise requires:

(a)           “affiliate” means any person controlled by or under common control with the Company but shall not include any stockholder or director of the Company, as such.

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(b)           “person” means any individual, corporation, partnership, limited liability company, firm, joint company, association, joint-stock company, trust, unincorporated organization, governmental or regulatory body or other entity.

10.3        Delay in Payments.  Notwithstanding anything to the contrary in this Agreement, (i) if upon the date of Executive’s termination of employment with the Company, Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or any regulations or Treasury guidance promulgated thereunder (the “Code”) and the deferral of any amounts otherwise payable under this Agreement as a result of Executive’s termination of employment is necessary in order to prevent any accelerated or additional tax to Executive under Code Section 409A, then the Company will defer the payment of any such amounts hereunder until the date that is six months following the date of Executive’s termination of employment with the Company, at which time any such delayed amounts will be paid to Executive in a single lump sum, with interest from the date otherwise payable at the prime rate as published in The Wall Street Journal on the date of Executive’s termination of employment with the Company, and (ii) if any other payments of money or other benefits due to Executive hereunder could cause the application of an accelerated or additional tax under Code Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Code Section 409A.

10.4        Reformation.  If any provision of this Agreement would cause Executive to occur any additional tax under Code Section 409A, the parties will in good faith attempt to reform the provision in a manner that maintains, to the extent possible, the original intent of the applicable provision without violating the provision of Code Section 409A.

11.                               ENFORCEABILITY

The agreements contained in the restrictive covenant provisions of this Agreement are independent of the other agreements contained herein.  Accordingly, failure of the Company to comply with any of its obligations outside of such Sections do not excuse Executive from complying with the agreements contained herein.

12.                               SURVIVABILITY

The agreements contained in Sections 5 shall survive the termination of this Agreement for any reason.

13.                               ASSIGNMENT

This Agreement cannot be assigned by Executive. The Company may assign this Agreement only to a successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially Al of the business and assets of the Company provided such successor expressly agrees in writing reasonably satisfactory to Executive to assume and 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 and assignment had taken place.  Failure of the Company to obtain such written agreement prior to the effectiveness of any such succession shall be a material breach of this Agreement.

14.                               BINDING AGREEMENT

Executive understands that his obligations under this Agreement are binding upon Executive’s heirs, successors, personal representatives, and legal representatives.

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15.                               NOTICES

All notices pursuant to this Agreement shall be in writing and sent certified mail, return receipt requested, addressed as set forth below, or by delivering the same in person to such party, or by transmission by facsimile to the number set forth below.  Notice deposited in the manner described hereinabove, shall be effective upon deposit.  Notice given in any other manner shall be effective only if and when received:

If to Executive:

Michel R.C. Derbyshire

1 Jalan Kilang Timor,

#07-01 Pacific Tech Centre,

Singapore 159303

If to Company:

Vantage International Payroll Company Pte. Ltd.

c/o Vantage Drilling Company

777 Post Oak Blvd., Suite 610

Houston, Texas 77056

16.                               WAIVER

No waiver by either party to this Agreement of any right to enforce any term or condition of this Agreement, or of any breach hereof shall be deemed a waiver of such right in the future or of any other right or remedy available under this Agreement.  The Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3.2 hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

17.                               SEVERABILITY

If any provision of this Agreement is determined to be void invalid, unenforceable, or against public policy, such provisions shall be deemed severable from the Agreement, and the remaining provisions of the Agreement will remain unaffected and in full force and effect.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

18.                               ARBITRATION

In the event any dispute arises out of Executive’s employment with or by the Company, or separation/termination therefrom, whether as an employee, which cannot be resolved by the Parties to this Agreement, such dispute shall be submitted to final and binding arbitration.  The arbitration shall be conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA”).  If the Parties cannot agree on an arbitrator, a list of seven

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(7) arbitrators will be requested from AAA, and the arbitrator will be selected using alternate strikes with Executive striking firm. The cost of the arbitration will be borne solely by the Company.  Arbitration of such disputes is mandatory and in lieu of any and all civil causes of action and lawsuits either party may have against the other arising out of Executive’s employment with Company, or separation therefrom.  Such arbitration shall be held in Houston, Texas.  This provision shall not, however, preclude the Company from obtaining injunctive relief in any court of competent jurisdiction to enforce Section 5 of this Agreement.

19.                               ENTIRE AGREEMENT

The terms and provisions contained herein shall constitute the entire agreement between the parties with respect to Executive’s employment with Company during the time period covered by this Agreement. This Agreement replaces and supersedes any and all existing Agreements entered into between Executive and the Company relating generally to the same subject matter, if any, except the offer of employment to Executive, dated October 31, 2007, and shall be binding upon Executive’s heirs, executors, administrators, or other legal representatives or assigns.

20.                               SECTION HEADINGS

The section headings in this Employment Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation.

21.                               MODIFICATION OF AGREEMENT

This Agreement may not be changed or modified or released or discharged or abandoned or otherwise terminated, in whole or in part, except by an instrument in writing signed by the Executive and an officer or other authorized executive of Company.

22.                               UNDERSTANDING OF AGREEMENT

Executive represents and warrants that he has read and understood each and every provision of this Agreement, and Executive understands that he has the right to obtain advice from legal counsel of choice, if necessary and desired, in order to interpret any and all provisions of this Agreement, and that Executive has freely and voluntarily entered into this Agreement.

23.                               GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

24.                               WITHHOLDING

All payments hereunder shall be subject to any required withholding of Federal, state and local taxes pursuant to any applicable law or regulation, except as provided in any tax equalization program or policy adopted by the Company for expatriate employees.

25.                               JURISDICTION AND VENUE

With respect to any litigation regarding this Agreement, Executive agrees to venue in the state or federal courts in Harris County, Texas and agrees to waive and does hereby waive any defenses and/or

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arguments based upon improper venue and/or lack of personal jurisdiction.  By entering into this Agreement, Executive agrees to personal jurisdiction in the state and federal courts in Harris County, Texas.

26.                               NO PRESUMPTION AGAINST INTEREST

This Agreement has been negotiated, drafted, edited and reviewed by the respective parties, and therefore, no provision arising directly or indirectly herefrom shall be construed against any party as being drafted by said party.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first above written.

EXECUTIVE
/s/ Michel R.C. Derbyshire
MICHEL R.C. DERBYSHIRE
VANTAGE INTERNATIONAL PAYROLL COMPANY PTE. LTD.
By:	/s/ Paul A. Bragg
Name:			Paul A. Bragg
Title:		Chief Executive Officer

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EX-10.8

Exhibit 10.8

EMPLOYMENT AND NON-COMPETITION AGREEMENT

BETWEEN

VANTAGE DRILLING COMPANY

AND

EDWARD G. BRANTLEY

DATED JUNE 12, 2008

TABLE OF CONTENTS

			Page
1.	EMPLOYMENT TERM AND DUTIES		1
	1.1	Term of Employment	1
	1.2	Duties as Employee of the Company	1
	1.3	Place of Performance	2
	1.4	Fiduciary Duty	2
	1.5	Compliance	2
2.	COMPENSATION AND RELATED MATTERS		2
	2.1	Base Salary	2
	2.2	Bonus Payments	2
	2.3	Expenses	3
	2.4	Automobiles	3
	2.5	Business, Travel and Entertainment Expenses	3
	2.6	Vacation	3
	2.7	Welfare, Pension and Incentive Benefit Plans	3
	2.8	Dues	3
	2.9	Other Benefits	3
	2.10	Perquisites	4
	2.11	Proration	4
	2.12	Intentionally Left Blank	4
	2.13	Additional Payments	4
		(a)     Excise Tax; Gross-Up Payment	4
		(b)     Accounting Firm Determinations	5
		(c)     Notification of Claims	5
		(d)     Refund	6
		(e)     Insurance	7
3.	TERMINATION		7
	3.1	Definitions	7
	3.1.2	Notice to Cure	7
	3.2	Termination Date	10
	3.3	Constructive Termination Without Cause	10
	3.4	Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits	10
	3.5	Base Salary	11
	3.6	Stock Awards	11
	3.7	Other Benefits	11
	3.8	Expenses	11
	3.9	Mitigation	11
	3.10	Maximum Payments	11
	3.11	Net After-Tax Benefit	12
	3.12	Termination In Event of Death: Benefits	12
	3.13	Termination In Event of Disability: Benefits	12

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	3.14	Voluntary Termination by Employee and Termination for Cause: Benefits	13
	3.15	Termination Procedure	13
		A.     Notice of Termination	13
		B.     Date of Termination	13
		C.     Mitigation	13
4.	DIRECTOR POSITIONS		14
5.	NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY		14
	5.1	Non-Competition During Employment	14
	5.2	Conflicts of Interest	14
	5.3	Non-Competition After Termination	14
	5.4	Non-Solicitation of Customers	15
	5.5	Non-Solicitation of Employees	15
	5.6	Confidential Information	15
	5.7	Original Material	16
	5.8	Return of Documents, Equipment, Etc.	16
	5.9	Reaffirm Obligations	16
	5.10	Prior Disclosure	16
	5.11	Confidential Information of Prior Companies	17
	5.12	Rights Upon Breach	17
		(a)     Specific Performance	17
		(b)     Accounting	17
	5.13	Remedies For Violation of Non-Competition or Confidentiality Provisions	17
	5.14	Severability of Covenants	18
	5.15	Court Review	18
	5.16	Enforceability in Jurisdictions	18
	5.17	Extension of Post-Employment Restrictions	18
6.	INDEMNIFICATION		18
	6.1	General	18
	6.2	Expenses	19
	6.3	Enforcement	19
	6.4	Partial Indemnification	19
	6.5	Advances of Expenses	19
	6.6	Notice of Claim	19
	6.7	Defense of Claim	19
	6.8	Non-exclusivity	20
7.	LEGAL FEES AND EXPENSES		20
8.	BREACH		20
9.	RIGHT TO ENTER AGREEMENT		21

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10.	COMPLIANCE WITH SECTION 409A	21
	10.2      Certain Definitions	21
	10.3      Delay in Payments	21
	10.4      Reformation	22
11.	ENFORCEABILITY	22
12.	SURVIVABILITY	22
13.	ASSIGNMENT	22
14.	BINDING AGREEMENT	22
15.	NOTICES	22
16.	WAIVER	23
17.	SEVERABILITY	23
18.	ARBITRATION	23
19.	ENTIRE AGREEMENT	24
20.	SECTION HEADINGS	24
21.	MODIFICATION OF AGREEMENT	24
22.	UNDERSTANDING OF AGREEMENT	24
23.	GOVERNING LAW	24
24.	WITHHOLDING	24
25.	JURISDICTION AND VENUE	25
26.	NO PRESUMPTION AGAINST INTEREST	25

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EMPLOYMENT AND NON-COMPETITION AGREEMENT

This Employment and Non-Competition Agreement (“Agreement”) is entered into as of the 12^th day of June, 2008 (the “Effective Date”), between Vantage Drilling Company, a Cayman islands corporation (“Company”), and Edward G. Brantley (“Employee” or “Executive”).

RECITALS:

WHEREAS, Executive is to be employed as an integral part of its management who participates in the decision-making process relative to short and long-term planning and policy for the Company, will serve on the Company’s Executive Management Committee;

WHEREAS, the Company desires to obtain assurances from the Executive that he will devote his best efforts to the Company and will not enter into competition with the Company, solicit its customers, or solicit employees of the Company after termination of his employment;

WHEREAS, Executive will serve as a key employee with special and unique talents and skills of peculiar benefit and importance to the Company; and

WHEREAS, Executive is desirous of committing himself to serve on the terms herein provided; and

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below, the Parties agree as follows:

1.                                             EMPLOYMENT TERM AND DUTIES

1.1          Term of Employment.  Effective as of the Effective Date, the Company hereby agrees to employ Executive as its Chief Accounting Officer, and Executive hereby agrees to accept such employment, on the terms and conditions set forth herein, for the period commencing on the Effective Date and expiring as of June 12, 2010 (the “Basic Term”) (unless sooner terminated as hereinafter set forth). The Basic Term shall be automatically extended for successive terms of one (1) year commencing on each Anniversary of the Effective Date thereafter (each such date being a “Renewal Date”), so as to terminate one (1) year from such Renewal Date, unless and until at least ninety (90) days prior to a Renewal Date either party hereto gives written notice to the other that the Term should not be further extended after the next Renewal Date (a “Notice of Non-Renewal”), in which event the Termination Date shall not be less than one (1) year following receipt of the Notice of Non-Renewal.

1.2          Duties as Employee of the Company.  Executive shall, subject to the supervision of the Chief Executive Officer and Board, have general management and control of the Company’s accounting in the ordinary course of its business with all such powers with respect to such management and control as may be reasonably incident to such responsibilities.  Executive shall devote his normal and regular business time, attention and skill to diligently attending to the business of the Company during the Basic Term. During the Basic Term, Executive shall not directly or indirectly render any services of a business, commercial, or professional nature to any

1

other person, firm, corporation, or organization, whether for compensation or otherwise, without the prior written consent of the Chairman of the Board.  Notwithstanding the foregoing, it shall not be a violation of the Agreement for Executive to (i) serve on corporate, civic or charitable boards or committees, (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, and (iii) manage personal investments so long as such activities do not materially interfere or conflict with the performance of his duties to the Company hereunder.  The conduct of such activity shall not be deemed to materially interfere or conflict with Executive’s performance of his duties until Executive has been notified in writing thereof and given a reasonable period in which to cure the same.

1.3          Place of Performance.  During the Employment Period, the Company shall maintain its executive offices in Houston, Texas, and the Executive shall not be required to relocate to any other location.  During the Employment Period, the Company shall provide the Executive with an office and staff and other such facilities and services as shall be suitable to Executive’s position and adequate for the performance of Executive’s duties hereunder.

1.4          Fiduciary Duty.  Executive acknowledges and agrees that he owes a fiduciary duty to the Company, and further agrees to make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not act for his own benefit concerning the subject matter of his fiduciary relationship.

1.5          Compliance.  Executive agrees that he will not take any action which he knows would not comply with United States law as applicable to Executive’s employment, including, but without limitation to the Foreign Corrupt Practices Act.

2.COMPENSATION AND RELATED MATTERS

2.1          Base Salary.  Executive shall receive a base salary (the “Base Salary”) paid by the Company at the annual rate of One Hundred Ninety Thousand ($190,000.00) U.S., payable not less frequently than in substantially equal monthly installments, with the opportunity to increases, from time to time thereafter which are in accordance with the Company’s regular executive compensation practices.

2.2          Bonus Payments.  For each full fiscal year of the Company that begins and ends during the Employment Period, and for the portion of the fiscal year of the Company that begins in 2008 (“Fiscal Year 2008”), the Executive shall be eligible to earn an annual cash bonus in such amount as shall be determined by the Compensation Committee of the Board (the “Compensation Committee”) (the “Annual Bonus”) based on the achievement by the Company of performance goals established by the Compensation Committee for each such fiscal year (or portion of Fiscal Year 2008).  The Compensation Committee shall establish objective criteria to be used to determine the extent to which performance goals have been satisfied.  For purposes of this Agreement, net earnings per share is defined as the Company’s consolidated net earnings per share as reported in the Company’s Annual Report on Form 10-K.  The Executive’s annual bonus potential target shall not be less than fifty percent (50%) of Base Salary.

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2.3          Expenses.  During the Basic Term, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by him in accordance with the policies and procedures established by the Compensation Committee for the Company’s senior executive officers in performing services hereunder, provided that Executive properly accounts for such expenses in accordance with the Company’s policies and procedures.

2.4          Automobiles.  The Company shall provide the Executive with an automobile allowance of $750.00 per month consistent with the practices of the Company.

2.5          Business, Travel and Entertainment Expenses.  The Company shall promptly reimburse the Executive for all business, travel and entertainment expenses consistent with the Executive’s titles and the practices of the Company.

2.6          Vacation.  The Executive shall be entitled to four (4) weeks of vacation per year. Vacation not taken during the applicable fiscal year (but not in excess of two (2) weeks) shall be carried over to the next following fiscal year.

2.7          Welfare, Pension and Incentive Benefit Plans.  During the Employment Period, the Executive (and his eligible spouse and dependents) shall be entitled to participate in all the welfare benefit plans and programs maintained by the Company from time-to-time for the benefit of its senior executives including, without limitation, all medical, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs. In addition, during the Employment Period, the Executive shall be eligible to participate in all pension, retirement, savings and other employee benefit plans and programs maintained from time-to-time by the Company for the benefit of its senior executives, other than any annual cash incentive plan.

2.8          Dues.  During the Employment Period, the Company shall pay or promptly reimburse the Executive for annual dues for membership in professional organizations relevant to Executive’s job responsibilities.

2.9          Other Benefits.  Executive shall be entitled to participate in or receive benefits under any compensatory employee benefit plan or other arrangement made available by the Company now or in the future to its senior executive officers and key management employees, subject to and on a basis consistent with the terms, conditions, and overall administration of such plan or arrangement. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the Base Salary payable to Executive pursuant to Section 2.1 of this Agreement.  The Company shall not make any changes in any employee benefit plans or other arrangements in effect on the date hereof or subsequently in effect in which Executive currently or in the future participates (including, without limitation, each pension and retirement plan, supplemental pension and retirement plan, savings and profit sharing plan, stock or unit ownership plan, stock or unit purchase plan, stock or unit option plan, life insurance plan, medical insurance plan, disability plan, dental plan, health and accident plan, or any other similar plan or arrangement) that would adversely affect Executive’s rights or benefits thereunder, unless such change occurs pursuant to a program applicable to substantially all executives of the Company and does not result in a proportionately greater reduction in the

3

rights of or benefits to Executive as compared with any other executive of the Company.  The Company shall recommend that Executive receive an annual award of restricted stock and/or stock options in Vantage Drilling Company in the amount of approximately Two Hundred Thousand Dollars ($200,000) based on market studies of industry executives, but Executive recognizes and agrees that future years could vary significantly as market conditions and industry compensation trends change.  If there is a Change of Control (as herein defined), any Stock Awards (as herein defined) which Executive has received under this Agreement shall vest immediately.

2.10        Perquisites.  Executive shall be entitled to receive the perquisites and fringe benefits appertaining to an executive officer of the Company, in accordance with any practice established by the Compensation Committee.  In addition to the other benefits provided in this Agreement, Executive and his family shall be entitled to receive medical insurance as that may be provided under the Company’s group program, as such group program may be changed from time-to-time in the future, and Executive shall be entitled to continue to be covered by such group program or, if not permitted under the terms of the group program, then the Company shall provide Executive with a medical insurance policy providing substantially similar benefits as to the group program, for the period ending on the date of the later to die of Executive or, if Executive is married on the date of his death, Executive’s spouse.  Executive shall be entitled to receive the medical benefits defined herein at no cost to the Executive.  However, Executive’s rights pursuant to this subsection shall be void if Executive is terminated for Cause or if Executive voluntarily terminates his employment.

2.11        Proration.  Any payments or benefits payable to Executive hereunder in respect of any calendar year during which Executive is employed by the Company for less than the entire year, unless otherwise provided in the applicable plan or arrangement, shall be prorated in accordance with the number of days in such calendar year during which he is so employed.

2.12        Intentionally left blank.

2.13        Additional Payments.

(a)           Excise Tax; Gross-Up Payment.  Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by the Company to or for 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 under this Section (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (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, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise

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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.

(b)           Accounting Firm Determinations.  All determinations required to be made under this Section 2.13, including whether and when 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 a reputable accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (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. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting a Change of Control of the Company, the Executive shall appoint another reputable 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 Section, shall be paid by the Company to the Executive within five (5) days after 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 should have been made (an “Underpayment”), consistent with the calculations required to be made hereunder.  In the event that the Company exhausts its remedies pursuant to this Section and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment and any applicable penalty that has occurred and the amount of any such Underpayment and any applicable penalty shall be promptly paid by the Company to or for the benefit of the Executive.

(c)           Notification of Claims.  The Executive shall notify the Company in writing of any claims by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as practicable but no later than thirty (30) days after the Executive actually receives notice 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 thirty (30) day period following the date on which the Executive 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:

1.             give the Company any information reasonably requested by the Company relating to such claim;

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2.             take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;

3.             cooperate with the Company in good faith in order to effectively contest such claim; and

4.             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 on the foregoing provisions of this Section, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego 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 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 further provided 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)           Refund.  If, after the receipt by the Executive of an amount advanced by the Company pursuant to this Section, 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 this Section) 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 this Section, 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

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thirty (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.

(e)           Insurance.  The Company may, from time to time, apply for and take out, in its own name and at its own expense, naming itself or one or more of its affiliates as the designated beneficiary (which it may change from time to time), policies for life, health, accident, disability or other insurance upon the Executive in any amount or amounts that it may deem necessary or appropriate to protect its interest.  The Executive agrees to aid the Company in procuring such insurance by submitting to medical examinations and by completing, executing and delivering such applications and other instruments in writing as may reasonably be required by an insurance company or companies to which any application or applications for insurance may be made by or for the Company.

3.TERMINATION

3.1          Definitions.

A.            “Cause” shall mean:

(i)            Material dishonesty which is not the result of an inadvertent or innocent mistake of Executive with respect to the Company or any of its subsidiaries;

(ii)           Willful misfeasance or nonfeasance of duty by Executive intended to injure or having the effect of injuring in some material fashion the reputation, business, or business relationships of the Company or any of its subsidiaries or any of their respective officers, directors, or employees;

(iii)          Material violation by Executive of any material term of this Agreement;

(iv)          Conviction of Executive of any felony, any crime involving moral turpitude or any crime other than a vehicular offense which could reflect in some material fashion unfavorably upon the Company or any of its subsidiaries; or

(v)           Violation of Sections 1.3 or 1.4 above.

3.1.2       Notice to Cure.  Executive may not be terminated for Cause unless and until there has been delivered to Executive written notice from the Board supplying the particulars of Executive’s acts or omissions that the Board believes constitute Cause, a reasonable period of time (not less than 30 days) has been given to Executive after such notice to either cure the same or to meet with the Board, with his attorney if so desired by

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Executive, and following which the Board by action of not less than two-thirds of its members furnishes to Executive a written resolution specifying in detail its findings that Executive has been terminated for Cause as of the date set forth in the notice to Executive.

3.1.3       A.           For purposes of this Agreement, no act or failure to act by the Executive shall be considered “willful” if such act is done by the Executive in the good faith belief that such act is or was to be beneficial to the Company or one or more of its businesses, or such failure to act is due to the Executive’s good faith belief that such action would be materially harmful to the Company or one of its businesses.  Cause shall not exist unless and until the Company has delivered to the Executive a copy of a resolution duly adopted by a majority of the Board (excluding the Executive for purposes of determining such majority) at a meeting of the Board called and held for such purpose after reasonable (but in no event less than thirty days’) notice to the Executive and an opportunity for the Executive, together with his counsel, to be heard before the Board, finding that in the good faith opinion of the Board that “Cause” exists, and specifying the particulars thereof in detail.  This Section shall not prevent the Executive from challenging in an arbitration proceeding the Board’s determination that Cause exists or that the Executive has failed to cure any act (or failure to act) that purportedly formed the basis for the Board’s determination.

B.            A “Change of Control” shall be deemed to have occurred if:

(i)            A reverse merger involving the Company or the Parent in which the Company or the Parent, as the case may be, is the surviving corporation but the shares of common stock of the Company or the Parent (the “Common Stock”) outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise, and the shareholders of the Parent immediately prior to the completion of such transaction hold, directly or indirectly, less than fifty percent (50%) of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act, or comparable successor rules) of the surviving entity or, if more than one entity survives the transaction, the controlling entity; or

(ii)           Any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of 50% or more of the Company’s then outstanding voting common stock; or

(iii)          At any time during the period of three (3) consecutive years (not including any period prior to the date hereof), individuals who at the beginning of such period constituted the Board (and any new

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director whose election by the Board or whose nomination for election by the Company’s shareholders were approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority thereof; or

(iv)          The shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation (a) in which a majority of the directors of the surviving entity were directors of the Company prior to such consolidation or merger, and (b) which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being changed into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation; or

(v)           The shareholders approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

C.            A “Disability” shall mean the absence of Executive from Executive’s duties with the Company on a full-time basis for 180 consecutive days, or 180 days in a 365-day period, as a result of incapacity due to mental or physical illness which results in the Executive being unable to perform the essential functions of his position, with or without reasonable accommodation.

D.            A “Good Reason” shall mean any of the following (without Executive’s express written consent):

(i)            Following a Change of Control, a material alteration in the nature or status of Executive’s title, duties or responsibilities, or the assignment of duties or responsibilities inconsistent with Executive’s status, title, duties and responsibilities;

(ii)           A failure by the Company to continue in effect any employee benefit plan in which Executive was participating, or the taking of any action by the Company that would adversely affect Executive’s participation in, or materially reduce Executive’s benefits under, any such employee benefit plan, unless such failure or such taking of any action adversely affects the senior members of corporate management of the Company generally to the same extent;

(iii)          A relocation of the Company’s principal offices, or Executive’s relocation to any place other than the principal executive

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offices, exceeding a distance of fifty (50) miles from the Company’s current executive office located in Houston, Texas, except for reasonably required travel by Executive on the Company’s business;

(iv)          Any material breach by the Company of any provision of this Agreement;

(v)           Any failure by the Company to obtain the assumption and performance of this Agreement by any successor (by merger, consolidation, or otherwise) or assign of the Company; or

(vi)          The Company provides written notice of non-renewal to the Executive.

However, Good Reason shall exist with respect to an above specified matter only if such matter is not corrected by the Company within thirty (30) days of its receipt of written notice of such matter from Executive, and in no event shall a termination by Executive occurring more than ninety (90) days following the date of the event described above be a termination for Good reason due to such event.

3.2          Termination Date.  “Termination Date” shall mean the date Executive is terminated for any reason pursuant to this Agreement.

3.3          Constructive Termination Without Cause.  “Constructive Termination Without Cause” shall mean: Notwithstanding any other provision of this Agreement, the Executive’s employment under this Agreement may be terminated during the Term by the Executive, which shall be deemed to be constructive termination by the Company without Cause, if one of the following events shall occur without the written consent of the Executive: (i) a reduction in the Executive’s fixed salary; (ii) the failure of the Company to continue to provide the Executive with office space, related facilities and secretarial assistance that are commensurate with the Executive’s responsibilities to and position with the Company; (iii) the notification by the Company of the Company’s intention not to observe or perform one or more of the obligations of the Company under this Agreement; or (iv) the failure by the Company to indemnify, pay or reimburse the Executive at the time and under the circumstances required by this Agreement.  Any such termination pursuant to this Section shall be made by the Executive providing written notice to the Company specifying the event relied upon for such termination and given within sixty (60) days after such event.  Any constructive termination pursuant to this Section shall be effective sixty (60) days after the date the Executive has given the Company such written notice setting forth the grounds for such termination with specificity; provided, however, that the Executive shall not be entitled to terminate this Agreement in respect of any of the grounds set forth above if within sixty (60) days after such notice the action constituting such ground for termination has been cured and is no longer continuing.

3.4          Termination Without Cause or Termination For Good Reason or Constructive Termination Without Cause: Benefits.

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3.5          Base Salary and Annual Bonus.  For a period of twelve (12) months after the Termination Date, Base Salary and Annual Bonus (as such terms are defined herein) at the rate, and payable quarterly unless such termination is by the Company without Cause, in which even such amount of Base Salary and Annual Bonus shall be paid in a lump sum within ten (10) days of the Termination Event.

3.6          Stock Awards.  If there is a Change of Control or if there is a Termination Event, any stock or stock option award issued pursuant to the 2007 Long Term Incentive Compensation Plan (“Stock Awards”) which Executive has received under this Agreement shall vest immediately and, if there is a Termination Event, all such Stock Awards shall be exercisable from the date of such Termination Event for the remainder of their term.

3.7          Other Benefits.  To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other amounts or benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy or practice, or contract or agreement of the Company and its affiliated companies for the period of time equal to the remainder of the Basic Term (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).  Without limiting the preceding sentence and without limiting any other provision of this Agreement, through the remaining Basic Term, but under no condition less than one (1) year, the Company, at its sole expense, shall continue to provide (through its own plan and/or individual policies) Executive (and Executive’s dependents) with health benefits no less favorable than the group health plan benefits provided during such period to any senior executive officer of the Company or any affiliated company (to the extent any such coverage or benefits are taxable to Executive by reason of being provided under a self-insured health plan of the Company or an affiliate, the Company shall make Executive “whole” for the same on an after-tax basis).  In any event, the Other Benefits provided for pursuant to this Section shall be secondary to any benefits and coverage Executive (or his dependents) receive from another employer.

3.8          Expenses.  All accrued compensation and unreimbursed expenses through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the Termination Date; and

3.9          Mitigation.  Executive shall be free to accept other employment during such period, subject to the limitation as set forth in Section 5 of this Agreement and there shall be no offset of any employment compensation earned by Executive in such other employment during such period against payments due Executive under this Section 3, and there shall be no offset in any compensation received from such other employment against the Base Salary set forth above.

3.10          Maximum Payments.  It is the objective of this Agreement to maximize the Executive’s Net After-Tax Benefit (as defined herein) if payments or benefits provided under this Section are subject to excise tax under Section 4999 of the Code.  Therefore, in the event it is determined that any payment or benefit 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 Section or otherwise, including, by example and not by way of limitation, acceleration by the Company or otherwise of the date of vesting or payment or rate of payment under any plan, program or

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arrangement of the Company, would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties 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”), the Company shall first make a calculation under which such payments or benefits provided to the Executive under this Agreement are reduced to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code (the “4999 Limit”).  The Company shall then compare (x) the Executive’s Net After-Tax Benefit assuming application of  the 4999 Limit with (y) the Executive’s Net After-Tax Benefit without the application of the 4999 Limit and the Executive shall be entitled to the greater of (x) or (y).

3.11          Net After-Tax Benefit.  “Net After-Tax Benefit” shall mean the sum of (i) all payments and benefits which the Executive receives or is then entitled to receive from the Company, less (ii) the amount of federal income taxes payable with respect to the payments and benefits described in (i) above calculated at the maximum marginal income tax rate for each year in which such payments and benefits shall be paid to the Executive (based upon the rate for such year as set forth in the Code at the time of the first payment of the foregoing), less (iii) the amount of excise taxes imposed with respect to the payments and benefits described in (i) above by Section 4999 of the Code.  The determination of whether a payment or benefit constitutes an excess parachute payment shall be made by tax counsel selected by the Company and reasonably acceptable to the Executive. The costs of obtaining this determination shall be borne by the Company.

3.12          Termination In Event of Death: Benefits.  If Executive’s employment is terminated by reason of Executive’s death during the Basic Term, this Agreement shall terminate, except as provided herein, without further obligation to Executive’s legal representatives under this Agreement, other than for payment of all accrued compensation, unreimbursed expenses, the timely payment or provision of Other Benefits through the date of death, one (1) year’s Base Salary, and such cash or stock bonus as Executive would otherwise have been awarded in year if Executive’s death had not occurred.  Such amounts shall be paid to Executive’s estate or beneficiary, as applicable, in a lump sum in cash within ninety (90) days after the date of death.  With respect to the provision of Other Benefits, the term Other Benefits as used in this Section shall include, without limitation, and Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company to the estates and beneficiaries of other executive level employees of the Company under such plans, programs, practices, and policies relating to death benefits, if any, as in effect with respect to other executives and their beneficiaries at any time during the 120-day period immediately preceding the date of death.  Additionally, all Stock Awards shall be vested immediately and shall be exercisable for the greater of one year after the date of such vesting or the remaining term of such option.

3.13          Termination In Event of Disability: Benefits.  If Executive’s employment is terminated by reason of Executive’s Disability during the Basic Term, this Agreement shall continue in full force for a period of one (1) year following such Disability and if such Disability occurs on or after June 1 of any year Executive shall be entitled to the same cash or stock bonus in such year that Executive would have been awarded if such Disability had not occurred. In

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addition, all outstanding Stock Awards shall vest immediately upon such termination due to Disability.

3.14          Voluntary Termination by Employee and Termination for Cause: Benefits. Executive may terminate his employment with the Company without Good Reason by giving written notice of his intent and stating an effective Termination Date at least ninety (90) days after the date of such notice; provided, however, that the Company may accelerate such effective date by paying Executive through the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date and also vesting awards that would have vested but for this acceleration of the proposed Termination Date.  Upon such a termination by Executive, except as provided in Section 5, or upon termination for Cause by the Company, this Agreement shall terminate and the Company shall pay to Executive all accrued compensation, unreimbursed expenses and the Other Benefits through the Termination Date.  Such amounts shall be paid to Executive in a lump sum in cash within thirty (30) days after the date of termination.  In addition, all unvested stock options shall terminate and all vested options will terminate one hundred twenty (120) days after the Termination Date.

3.15          Termination Procedure.

A.            Notice of Termination.  Any termination of the Executive’s employment by the Company or by the Executive during the Employment Period (other than pursuant to Section 3.5) shall be communicated by written Notice of Termination to the other party. For purposes of this Agreement, a “Notice of Termination” shall mean a notice indicating the specific termination provision in this Agreement relied upon and setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under that provision.

B.            Date of Termination.  “Date of Termination” shall mean (i) if the Executive’s employment is terminated by his death, the date of his death, (ii) if the Executive’s employment is terminated pursuant to Section 3.13, thirty (30) days after the date of receipt of the Notice of Termination (provided that the Executive does not return to the substantial performance of his duties on a full-time basis during such thirty (30) day period), and (iii) if the Executive’s employment is terminated for any other reason, the date on which a Notice of Termination is given or any later date (within thirty (30) days after the giving of such notice) set forth in such Notice of Termination.

C.            Mitigation.  The Executive shall not be required to mitigate damages with respect to the termination of his employment under this Agreement by seeking other employment or otherwise, and there shall be no offset against amounts due the Executive under this Agreement on account of subsequent employment except as specifically provided in this Agreement. Additionally, amounts owed to the Executive under this Agreement shall not be offset by any claims the Company may have against the Executive, and the Company’s obligation to make the payments provided for in this Agreement, and otherwise to perform its obligations hereunder, shall not be affected by any other circumstances, including, without limitation, any counterclaim, recoupment, defense or other right which the Company may have against the Executive or others.

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4.DIRECTOR POSITIONS

Executive agrees that upon termination of employment, for any reason, at the request of the Chairman of the Board, he will immediately tender his resignation from any and all Board positions held with the Company and/or any of its subsidiaries and affiliates. If Executive remains as a director, at the election of the Board, after such termination, Executive shall be compensated as an outside director.

5.NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY

The Company shall provide Executive with its trade secrets, goodwill, and confidential information of Company and contact with the Company’s customers and potential customers.  Executive also recognizes and agrees that the benefit of not being employed at-will, is provided in consideration for, among other things, the agreements contained in this Section, as well as the Stock Awards granted to Executive pursuant to this Agreement.  Executive agrees that the business of the Company is highly competitive and that the trade secrets, goodwill, and confidential information of the Company is of primary importance to the success of the Company.  In consideration of all of the foregoing, and in recognition of these conditions, and specifically for being provided trade secrets, goodwill, and confidential information, Executive agrees as follows:

5.1          Non-Competition During Employment.  Executive agrees during the Basic Term he will not compete with the Company by engaging in the conception, design, development, production, marketing, or servicing of any product or service that is substantially similar to the products or services which the Company provides, and that he will not work for, in any capacity, assist, or became affiliated with as an owner, partner, etc., either directly or indirectly, any individual or business which offer or performs services, or offers or provides products substantially similar to the services and products provided by Company.

5.2          Conflicts of Interest.  Executive agrees that during the Basic Term, he will not engage, either directly or indirectly, in any activity (a “Conflict of Interest”) which might adversely affect the Company or its affiliates, including ownership of a material interest in any supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business or accepting any material payment, service, loan, gift, trip, entertainment, or other favor from a supplier, contractor, distributor, subcontractor, customer or other entity with which the Company does business, and that Executive will promptly inform the Chairman of the Company as to each offer received by Executive to engage in any such activity. Executive further agrees to disclose to the Company any other facts of which Executive becomes aware which might in Executive’s good faith judgment reasonably be expected to involve or give rise to a Conflict of Interest or potential Conflict of Interest.

5.3          Non-Competition After Termination.  In further consideration of the Company providing Employee confidential information, executive agrees that Executive shall not, at any time during the period of one (1) year after termination within the geographic area as

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defined by this Section 5 that the Company has sold products or services or formulated a plan to sell products or services into a market during the last twelve (12) months of Executive’s employ, engage in or contribute Executive’s knowledge to any work which is competitive with or similar to a product, process, apparatus, services, or development on which Executive worked or with respect to which Executive had access to Confidential Information while employed by the Company.  It is understood that the geographical area set forth in this covenant is divisible so that if this clause is invalid or unenforceable in an included geographic area, that area is severable and the clause remains in effect for the remaining included geographic areas in which the clause is valid. For purposes of this Section 5.3, the geographic area shall apply to the territory or country where the Company conducts operations.

5.4          Non-Solicitation of Customers.  In further consideration of the Company providing Employees confidential information, Executive further agrees that for a period of one (1) year after termination, he will not solicit or accept any business from any customer or client or prospective customer or client with whom Executive dealt or solicited while employed by Company during the last twelve (12) a months of his employment.

5.5          Non-Solicitation of Employees.  Executive agrees that for the duration of the Basic Term, and for a period of one (1) year after the termination of the Basic Term, he will not either directly or indirectly, on his own behalf or on behalf of others, solicit, attempt to hire, or hire any person employed by Company to work for Executive or for another entity, firm, corporation, or individual.

5.6          Confidential Information.  Executive further agrees that he will not, except as the Company may otherwise consent or direct in writing, reveal or disclose, sell, use, lecture upon, publish or otherwise disclose to any third party any Confidential Information or proprietary information of the Company, or authorize anyone else to do these things at any time either during or subsequent to his employment with the Company.  This Section shall continue in full force and effect after termination of Executive’s employment and after the termination of this Agreement.  Executive shall continue to be obligated under the Confidential Information Section of this Agreement not to use or to disclose Confidential Information of the Company so long as it shall not be publicly available.  Executive’s obligations under this Section with respect to any specific Confidential Information and proprietary information shall cease when that specific portion of the Confidential Information and proprietary information becomes publicly known, in its entirety and without combining portions of such information obtained separately.  It is understood that such Confidential Information and proprietary information of the Company include matters that Executive conceives or develops, as well as matters Executive learns from other employees of Company. Confidential Information is defined to include information: (1) disclosed to or known by the Executive as a consequence of or through his employment with the Company; (2) not generally known outside the Company; and (3) which relates to any aspect of the Company or its business, finances, operation plans, budgets, research, or strategic development. “Confidential Information” includes, but is not limited to the Company’s trade secrets, proprietary information, financial documents, long range plans, customer lists, employer compensation, marketing strategy, data bases, costing data, computer software developed by the Company, investments made by the Company, and any information provided to the Company by a third party under restrictions against disclosure or use by the Company or others.

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5.7          Original Material.  The Executive agrees that any inventions, discoveries, improvements, ideas, concepts or original works of authorship relating directly to the Company Business, including without limitation information of a technical or business nature such as ideas, discoveries, designs, inventions, improvements, trade secrets, know-how, manufacturing processes, product formulae, design specifications, writings and other works of authorship, computer programs, financial figures, marketing plans, customer lists and data, business plans or methods and the like, which relate in any manner to the actual or anticipated business or the actual or anticipated areas of research and development of the Company and its divisions and affiliates, whether or not protectable by patent or copyright, that have been originated, developed or reduced to practice by the Executive alone or jointly with others during the Executive’s employment with the Company shall be the property of and belong exclusively to the Company. The Executive shall promptly and fully disclose to the Company the origination or development by the Executive of any such material and shall provide the Company with any information that it may reasonably request about such material.  Either during the subsequent to the Executive’s employment, upon the request and at the expense of the Company or its nominee, and for no remuneration in addition to that due the Executive pursuant to the Executive’s employment by the Company, but at no expense to the Executive, the Executive agrees to execute, acknowledge, and deliver to the Company or its attorneys any and all instruments which, in the judgment of the Company or its attorneys, may be necessary or desirable to secure or maintain for the benefit of the Company adequate patent, copyright, and other property rights in the United States and foreign countries with respect to any such inventions, improvements, ideas, concepts, or original works of authorship embraced within this Agreement.

5.8          Return of Documents, Equipment, Etc.  All writings, records, and other documents and things comprising, containing, describing, discussing, explaining, or evidencing any Confidential Information, and all equipment, components, parts, tools, and the like in Executive’s custody or possession that have been obtained or prepared in the course of Executive’s employment with the Company shall be the exclusive property of the Company, shall not be copied and/or removed from the premises of the Company, except in pursuit of the business of the Company, and shall be delivered to the Company, without Executive retaining any copies, upon notification of the termination of Executive’s employment or at any other time requested by the Company. The Company shall have the right to retain, access, and inspect all property of Executive of any kind in the office, work area, and on the premises of the Company upon termination of Executive’s employment and at any time during employment by the Company upon termination of Executive’s employment and at any time during employment by the Company to ensure compliance with the terms of this Agreement.

5.9          Reaffirm Obligations.  Upon termination of his employment with the Company, Executive, if requested by Company, shall reaffirm in writing Executive’s recognition of the importance of maintaining the confidentiality of the Company’s Confidential Information and proprietary information, and reaffirm any other obligations set forth in this Agreement.

5.10        Prior Disclosure.  Executive represents and warrants that he has not used or disclosed any Confidential Information he may have obtained from Company prior to signing this Agreement, in any way inconsistent with the provisions of this Agreement.

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5.11        Confidential Information of Prior Companies.  Executive will not disclose or use during the period of his employment with the Company any proprietary or Confidential Information or Copyright Works which Executive may have acquired because of employment with an employer other than the Company or acquired from any other third party, whether such information is in Executive’s memory or embodied in a writing or other physical form

5.12        Rights Upon Breach.  If the Executive breaches, any of the provisions contained in Section 5 of this Agreement (the “Restrictive Covenants”), the Company shall have the following rights and remedies, each of which rights and remedies shall be independent of the others and severally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity:

(a)           Specific Performance.  The right and remedy to have the Restrictive Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach of the Restrictive Covenants would cause irreparable injury to the Company and that money damages would not provide an adequate remedy to the Company.

(b)           Accounting.  The right and remedy to require the Executive to account for and pay over to the Company all compensation, profits, monies, accruals, increments or other benefits derived or received by the Executive as the result of any action constituting a breach of the Restrictive Covenants.

5.13        Remedies For Violation of Non-Competition or Confidentiality Provisions. Without limiting the right of the Company to pursue all other legal and equitable rights available to it for violation of any of the obligations and covenants made by Employee herein, it is agreed that:

(a)           the skills, experience and contacts of Employee are of a special, unique, unusual and extraordinary character which give them a peculiar value;

(b)           because of the business of the Company, the restrictions agreed to by Employee as to time and area contained in the Agreement are reasonable; and

(c)           the injury suffered by the Company by a violation of any obligation or covenant in the Agreement resulting from loss of profits created by (i) the competitive use of such skills, experience contacts and otherwise and/or (ii) the use or communication of any information deemed confidential herein will be difficult to calculate in damages in an action at law and cannot fully compensate the Company for any violation of any obligation or covenant in the Agreement, accordingly:

(i)            the Company shall be entitled to injunctive relief to prevent violations thereof and prevent Employee from rendering any services to any person, firm or entity in breach of such obligation or covenant and to prevent Employee from divulging any confidential information; and

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(ii)           compliance with the Agreement is a condition precedent to the Company’s obligation to make payments of any nature to employee, subject to the other provisions hereof.

(d)           employee waives any objection to the enforceability of the restrictive covenants and agrees to be estopped from denying the legality and enforceability of these provisions.

5.14        Severability of Covenants.  The Executive acknowledges and agrees that the Restrictive Covenants are reasonable and valid in duration and geographical scope and in all other respects.  If any court determines that any of the Restrictive Covenants, or any part thereof, is invalid or unenforceable, the remainder of the Restrictive Covenants shall not thereby be affected and shall be given full effect without regard to the invalid portions.

5.15        Court Review.  If any court determines that any of the Restrictive Covenants, or any part thereof is unenforceable because of the duration or geographical scope of or scope of activities restrained by, such provision, such court shall have the power to reduce the duration or scope of such provision, as the case may be, and, in its reduced form, such provision shall then be enforceable.

5.16        Enforceability in Jurisdictions.  The Company and the Executive intend to and hereby confer jurisdiction to enforce the Restrictive Covenants upon the courts of any jurisdiction within the geographical scope of such Restrictive Covenants.  If the courts of any one or more of such jurisdictions hold the Restrictive Covenants unenforceable by reason of the breadth of such scope or otherwise, it is the intention of the Company that such determination not bar or in any way affect the right of the Company to the relief provided above in the courts of any other jurisdiction within the geographical scope of such Restrictive Covenants, as to breaches of such Restrictive Covenants in such other respective jurisdictions, such Restrictive Covenants as they relate to each jurisdiction being, for this purpose, severable into diverse and independent covenants.

5.17        Extension of Post-Employment Restrictions.  In the event Executive breaches Section 5 above, the restrictive time periods contained in those provisions will be extended by the period of time Executive was in violation of such provisions.

6.INDEMNIFICATION

6.1          General.  The Company agrees that if the Executive is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”), by reason of the fact that the Executive is or was a trustee, director or officer of the Company, the Company, or any predecessor to the Company (including any sole proprietorship owned by the Executive) or any of their affiliates or is or was serving at the request of the Company, the Company, any predecessor to the Company (including any sole proprietorship owned by the Executive), or any of their affiliates as a trustee, director, officer, member, employee or agent of another corporation or a partnership, joint

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venture, limited liability company, trust or other enterprise, including, without limitation, service with respect to employee benefit plans, whether or not the basis of such Proceeding is alleged action in an official capacity as a trustee, director, officer, member, employee or agent while serving as a trustee, director, officer, member, employee or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by Texas law, as the same exists or may hereafter be amended, against all Expenses incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to the Executive even if the Executive has ceased to be an officer, director, trustee or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators.

6.2          Expenses.  As used in this Section, the term “Expenses” shall include, without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, and costs, attorneys’ fees, accountants’ fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing a right to indemnification under this Agreement.

6.3          Enforcement.  If a claim or request under this Section 6 is not paid by the Company or on its behalf, within thirty (30) days after a written claim or request has been received by the Company, the Executive may at any time thereafter bring an arbitration claim against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part, the Executive shall be entitled to be paid also the expenses of prosecuting such suit.  All obligations for indemnification hereunder shall be subject to, and paid in accordance with, applicable Texas law.

6.4          Partial Indemnification.  If the Executive is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify the Executive for the portion of such Expenses to which the Executive is entitled.

6.5          Advances of Expenses.  Expenses incurred by the Executive in connection with any Proceeding shall be paid by the Company in advance upon request of the Executive that the Company pay such Expenses, but only in the event that the Executive shall have delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect to which the Executive is not entitled to indemnification and (ii) a statement of his good faith belief that the standard of conduct necessary for indemnification by the Company has been met.

6.6          Notice of Claim.  The Executive shall give to the Company notice of any claim made against him for which indemnification will or could be sought under this Agreement.  In addition, the Executive shall give the Company such information and cooperation as it may reasonably require and as shall be within the Executive’s power and at such times and places as are convenient for the Executive.

6.7          Defense of Claim.  With respect to any Proceeding as to which the Executive notifies the Company of the commencement thereof:

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(a)           The Company will be entitled to participate therein at its own expense.

(b)           Except as otherwise provided below, to the extent that it may wish, the Company will be entitled to assume the defense thereof, with counsel reasonably satisfactory to the Executive, which in the Company’s sole discretion may be regular counsel to the Company and may be counsel to other officers and directors of the Company or any subsidiary.  The Executive also shall have the right to employ his own counsel in such action, suit or proceeding if he reasonably concludes that failure to do so would involve a conflict of interest between the Company and the Executive, and under such circumstances the fees and expenses of such counsel shall be at the expense of the Company.

(c)           The Company shall not be liable to indemnify the Executive under this Agreement for any amounts paid in settlement of any action or claim effected without its written consent.  The Company shall not settle any action or claim in any manner which would impose any penalty that would not be paid directly or indirectly by the Company or limitation on the Executive without the Executive’s written consent. Neither the Company nor the Executive will unreasonably withhold or delay their consent to any proposed settlement.

6.8          Non-exclusivity.  The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Section 6 shall not be exclusive of any other right which the Executive may have or hereafter may acquire under any statute or certificate of incorporation or by-laws of the Company or any subsidiary, agreement, vote of shareholders or disinterested directors or trustees or otherwise.

7.LEGAL FEES AND EXPENSES

If any contest or dispute shall arise between the Company and the Executive regarding any provision of this Agreement, the Company shall reimburse the Executive for all legal fees and expenses reasonably incurred by the Executive in connection with such contest or dispute, but only if the Executive prevails to a substantial extent with respect to the Executive’s claims brought and pursued in connection with such contest or dispute.  Such reimbursement shall be made as soon as practicable following the resolution of such contest or dispute (whether or not appealed) to the extent the Company receives reasonable written evidence of such fees and expenses. The Company shall advance the Executive reasonable attorney’s fees during any arbitration proceedings if brought by the Executive, up to but not to exceed Three Hundred Thousand Dollars ($300,000.00).

8.BREACH

Executive agrees that any breach of restrictive covenants above cannot be remedied solely by money damages, and that in addition to any other remedies Company may have, Company is entitled to obtain injunctive relief against Executive.  Nothing herein, however, shall be construed as limiting Company’s right to pursue any other available remedy at law or in

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equity, including recovery of damages and termination of this Agreement and/or any payments that may be due pursuant to this Agreement.

9.RIGHT TO ENTER AGREEMENT

Executive represents and covenants to Company that he has full power and authority to enter into this Agreement and that the execution of this Agreement will not breach or constitute a default of any other agreement or contract to which he is a party or by which he is bound.

10.COMPLIANCE WITH SECTION 409A

10.1        It is the intention of the Company and the Executive that this Agreement not result in unfavorable tax consequences to the Executive under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).  The Company and the Executive acknowledge that Section 409A of the Code was enacted pursuant to the American Jobs Creation Act of 2004, generally effective with respect to amounts deferred after January 1, 2005, and only limited guidance has been issued by the Internal Revenue Service with respect to the application of Code Section 409A to certain arrangements, such as this Agreement.  The Internal Revenue Service has indicated that it will provide further guidance regarding interpretation and application of Section 409A of the Code during 2005. The Company and the Executive acknowledge further that the full effect of Section 409A of the Code on potential payments pursuant to this Agreement cannot be fully determined at the time that the Company and the Executive are entering into this Agreement. The Company and the Executive agree to work together in good faith in an effort to comply with Section 409A of the Code including, if necessary, amending the Agreement based on further guidance issued by the Internal Revenue Service from time to time, provided that the Company shall not be required to assume any increased economic burden.

10.2        Certain Definitions.  As used in this Agreement, the following terms have the following meanings unless the context otherwise requires:

(a)           “affiliate” means any person controlled by or under common control with the Company but shall not include any stockholder or director of the Company, as such.

(b)           “person” means any individual, corporation, partnership, limited liability company, firm, joint company, association, joint-stock company, trust, unincorporated organization, governmental or regulatory body or other entity.

10.3        Delay in Payments.  Notwithstanding anything to the contrary in this Agreement, (i) if upon the date of Executive’s termination of employment with the Company, Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or any regulations or Treasury guidance promulgated thereunder (the “Code”) and the deferral of any amounts otherwise payable under this Agreement as a result of Executive’s termination of employment is necessary in order to prevent any accelerated or additional tax to Executive under Code Section 409A, then the Company will defer the payment

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of any such amounts hereunder until the date that is six months following the date of Executive’s termination of employment with the Company, at which time any such delayed amounts will be paid to Executive in a single lump sum, with interest from the date otherwise payable at the prime rate as published in The Wall Street Journal on the date of Executive’s termination of employment with the Company, and (ii) if any other payments of money or other benefits due to Executive hereunder could cause the application of an accelerated or additional tax under Code Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Code Section 409A.

10.4        Reformation.  If any provision of this Agreement would cause Executive to occur any additional tax under Code Section 409A, the parties will in good faith attempt to reform the provision in a manner that maintains, to the extent possible, the original intent of the applicable provision without violating the provision of Code Section 409A.

11.ENFORCEABILITY

The agreements contained in the restrictive covenant provisions of this Agreement are independent of the other agreements contained herein.  Accordingly, failure of the Company to comply with any of its obligations outside of such Sections do not excuse Executive from complying with the agreements contained herein.

12.SURVIVABILITY

The agreements contained in Sections 5 shall survive the termination of this Agreement for any reason.

13.ASSIGNMENT

This Agreement cannot be assigned by Executive. The Company may assign this Agreement only to a successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and assets of the Company provided such successor expressly agrees in writing reasonably satisfactory to Executive to assume and 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 and assignment had taken place.  Failure of the Company to obtain such written agreement prior to the effectiveness of any such succession shall be a material breach of this Agreement.

14.BINDING AGREEMENT

Executive understands that his obligations under this Agreement are binding upon Executive’s heirs, successors, personal representatives, and legal representatives.

15.NOTICES

All notices pursuant to this Agreement shall be in writing and sent certified mail, return receipt requested, addressed as set forth below, or by delivering the same in person to such party,

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or by transmission by facsimile to the number set forth below.  Notice deposited in the manner described hereinabove, shall be effective upon deposit.  Notice given in any other manner shall be effective only if and when received:

If to Executive:

Edward G. Brantley

4813 Elm Street

Bellaire, Texas 77401-2809

If to Company:

with a copy (which shall not constitute notice) to:

Vantage Drilling Company

777 Post Oak Blvd., Suite 610

Houston, Texas 77056

16.WAIVER

No waiver by either party to this Agreement of any right to enforce any term or condition of this Agreement, or of any breach hereof shall be deemed a waiver of such right in the future or of any other right or remedy available under this Agreement.  The Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3.2 hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

17.SEVERABILITY

If any provision of this Agreement is determined to be void invalid, unenforceable, or against public policy, such provisions shall be deemed severable from the Agreement, and the remaining provisions of the Agreement will remain unaffected and in full force and effect.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

18.ARBITRATION< /h1>

In the event any dispute arises out of Executive’s employment with or by the Company, or separation/termination therefrom, whether as an employee, which cannot be resolved by the Parties to this Agreement, such dispute shall be submitted to final and binding arbitration.  The arbitration shall be conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA”).  If the Parties cannot agree on an arbitrator, a list of seven (7) arbitrators will be requested from AAA, and the arbitrator will be selected using alternate strikes with Executive striking firm. The cost of the

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arbitration will be borne solely by the Company.  Arbitration of such disputes is mandatory and in lieu of any and all civil causes of action and lawsuits either party may have against the other arising out of Executive’s employment with Company, or separation therefrom.  Such arbitration shall be held in Houston, Texas.  This provision shall not, however, preclude the Company from obtaining injunctive relief in any court of competent jurisdiction to enforce Section 5 of this Agreement.

19.ENTIRE AGREEMENT

The terms and provisions contained herein shall constitute the entire agreement between the parties with respect to Executive’s employment with Company during the time period covered by this Agreement. This Agreement replaces and supersedes any and all existing Agreements entered into between Executive and the Company relating generally to the same subject matter, if any, except the offer of employment to Executive, dated March 13, 2008, and shall be binding upon Executive’s heirs, executors, administrators, or other legal representatives or assigns.

20.SECTION HEADIN GS

The section headings in this Employment Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation.

21.MODIFICATION OF AGREEMENT

This Agreement may not be changed or modified or released or discharged or abandoned or otherwise terminated, in whole or in part, except by an instrument in writing signed by the Executive and an officer or other authorized executive of Company.

22.UNDERSTANDING OF AGREEMENT

Executive represents and warrants that he has read and understood each and every provision of this Agreement, and Executive understands that he has the right to obtain advice from legal counsel of choice, if necessary and desired, in order to interpret any and all provisions of this Agreement, and that Executive has freely and voluntarily entered into this Agreement.

23.GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

24.WITHHOLDING< /h1>

All payments hereunder shall be subject to any required withholding of Federal, state and local taxes pursuant to any applicable law or regulation.

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25.JURISDICTION AND VENUE

With respect to any litigation regarding this Agreement, Executive agrees to venue in the state or federal courts in Harris County, Texas and agrees to waive and does hereby waive any defenses and/or arguments based upon improper venue and/or lack of personal jurisdiction.  By entering into this Agreement, Executive agrees to personal jurisdiction in the state and federal courts in Harris County, Texas.

26.NO PRESUMPTION AGAINST INTEREST

This Agreement has been negotiated, drafted, edited and reviewed by the respective parties, and therefore, no provision arising directly or indirectly herefrom shall be construed against any party as being drafted by said party.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first above written.

EXECUTIVE

/s/ Edward G. Brantley
Edward G. Brantley
VANTAGE DRILLING COMPANY
By:	/s/ Douglas G. Smith
Name:			Douglas G. Smith
Title:		Chief Financial Officer

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