I.

PRIOR AGREEMENTS/CONTRACTS

II.

DEFINITION OF TERMS

2.01

BOARD. The term “Board” means the Board of Directors of the Company.

2.02

CAUSE. The term “Cause” means: (i) the willful and continued failure of Employee substantially to perform his duties with the Company (other than any failure due to physical or mental incapacity) after a written demand for substantial performance is delivered to him by the Board which specifically identifies the manner in which the Board believes he has not substantially performed his duties, (ii) willful misconduct materially and demonstrably injurious to the Company, (iii) intentional action, materially and demonstrably injurious to Company, which Employee knows would not comply with the laws of the United States or any other jurisdiction applicable to Employee’s actions on behalf of the Company, and/or any of its subsidiaries or affiliates, including specifically, without limitation, the United States Foreign Corrupt Practices Act, generally codified in 15 USC 78 (the “FCPA”), as the FCPA may hereafter be amended, and/or its successor statutes, or (iv) material violation of one or more of the covenants in Article V (except violation of the covenant not to compete after termination of employment after Change in Control as discussed herein). No act or failure to act by Employee shall be considered “willful” unless done or omitted to be done by him not in good faith and without reasonable belief that his action or omission was in the best interest of the Company. The unwillingness of Employee to accept any or all of a change in the nature or scope of his position, authorities or duties, a reduction in his total compensation or benefits, or other action by or at request of the Company in respect of his position, authority, or responsibility that is contrary to this Agreement, may not be considered by the Board to be a failure to perform or misconduct by Employee. Notwithstanding the foregoing, Employee shall not be deemed to have been terminated for Cause for purposes of the Agreement unless and until there shall have been delivered to him a copy of a resolution, duly adopted by a vote of three-fourths of the entire Board at a meeting of the Board called and held (after a notice to Employee identifying in reasonable detail the manner in which Company believes Cause exists and an opportunity for Employee and his counsel to prepare for and to be heard before the Board) for the purpose of considering whether Employee has been guilty of such a willful failure to perform or such willful misconduct as justifies termination for Cause hereunder, finding that, in the good faith opinion of the Board, Employee has been guilty thereof, and specifying the particulars thereof.

2.03

CHANGE IN CONTROL. The term “Change in Control” of the Company shall mean, and shall be deemed to have occurred on the date of the first to occur of any of the following:

a.

any “person” (as such term is used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) is or becomes a beneficial owner, directly or indirectly, of securities of the Company representing thirty percent (30%) or more of the total voting power of the Company’s then outstanding securities;

b.

during any period of 12 consecutive months, individuals who, as of the date hereof, constitute the members of the Board (the “Incumbent Directors”) cease for any reason other than due to death or disability to constitute at least a majority of the members of the Board, provided that any director who was nominated for election or was elected with the approval of at least a majority of the members of the Board who are at the time Incumbent Directors shall be considered an Incumbent Director unless such individual’s initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board;

c.

the consummation of any transaction (including any merger, amalgamation, consolidation or scheme of arrangement), the result of which is that less than fifty percent (50%) of the total voting power of the surviving corporation is represented by shares held by former shareholders of the Company prior to such transaction; or

d.

the Company shall have sold, transferred or exchanged all, or substantially all, of its assets to another corporation or other entity or person.

2.04

CODE. The term “Code” means the Internal Revenue Code of 1986, as amended from time to time.

2.05

COMPANY. The term “Company” means Seahawk Drilling, Inc., a Delaware corporation, as the same presently exists, or any and all successors, regardless of the nature of the entity or the state or nation of organization, whether by assignment, reorganization, merger, consolidation, absorption or dissolution. For the purpose of Article V the term “Company” includes all subsidiaries of the Company to the extent such subsidiary is carrying on any portion of the business of the Company or a business similar to that being conducted by the Company. With regard to the determination of the amount or level of the Employee’s compensation and benefits payable hereunder, including annual bonuses and equity incentives, the term “Company” means the Board and/or the Compensation Committee of the Board.

2.06

CONSTRUCTIVE TERMINATION. The term “Constructive Termination” means a Termination by reason of Employee’s resignation for any one or more of the following events:

a.

Employee’s resignation or retirement is requested by the Company other than for Cause;

b.

any material reduction in Employee’s Annual Base Salary, Target Bonus or benefits other than equity or long-term incentive awards or actual bonus award payouts, in all cases as then in effect immediately prior to such reduction;

c.

any circumstance by which the actions of the Company either reduce or change Employee’s title, position, duties, responsibilities or authority to such an extent or in such a manner as to relegate Employee to a position not substantially similar to that which he held prior to such reduction or change and which would degrade, embarrass or otherwise make it unreasonable for Employee to remain in the employment of the Company, including Employee’s not being reelected to his position as a member of the Board, provided, however, that resignation of Employee from the Board shall not be deemed such a reduction or change;

d.

any requirement of the Company that Employee relocate more than 50 miles from downtown Houston, Texas, unless Employee recommended the relocation; or

e.

the material breach by the Company of any provision of the Agreement.

2.07

COVERED TERMINATION. The term “Covered Termination” shall mean the Employee’s Termination for any reason other than (i) Cause, (ii) Voluntary Resignation or (iii) death. Accordingly, a Covered Termination includes the Employee’s Termination by reason of Constructive Termination or Disability or Termination at the end of any “Employment Period” due to non-renewal or failure to extend this Agreement for any reason. Notwithstanding any provision hereof to the contrary, the Company shall have the right to terminate Employee’s employment at any time during the Employment Period, as defined below (including any extended term), and the Company has no obligation to deliver advance notice of termination.

2.08

CUSTOMER. The term “Customer” includes all persons, firms or entities that are purchasers or end-users of services or products offered, provided, developed, designed, sold or leased by the Company during the relevant time periods, and all persons, firms or entities which control, or which are controlled by, the same person, firm or entity which controls such purchase.

2.09

DISABILITY. The term “Disability” means physical or mental incapacity qualifying Employee for a long-term disability under the Company’s long-term disability plan. If no such plan exists on the date on which a relevant determination is being made, the term “Disability” means physical or mental incapacity as determined by a doctor jointly selected by Employee and the Board qualifying Employee for long-term disability under reasonable employment standards.

2.10

EFFECTIVE DATE. The term “Effective Date” means the date that the Agreement becomes effective and binding.

2.11

MAXIMUM BONUS. The term “Maximum Bonus” shall mean (i) Employee’s maximum bonus under the Company’s annual bonus incentive plan for the fiscal year in which a Covered Termination occurs as determined in accordance with Section 3.04b or (ii) if the Company has not specified a maximum bonus for such year, Employee’s maximum bonus under the Company’s annual bonus incentive plan for the last year in which the Company had specified such a maximum bonus, or (iii) if the Company has not specified a maximum bonus in the year of the Covered Termination or in a previous year, the maximum bonus identified in Section 3.04b.

2.12

SECTION 409A. The term “Section 409A” refers to Section 409A of the Code and applicable Treasury authorities promulgated thereunder.

2.13

TARGET BONUS. The term “Target Bonus” shall mean (i) Employee’s target bonus under the Company’s annual bonus incentive plan for the fiscal year in which a Covered Termination occurs as determined in accordance with Section 3.04b or (ii) if the Company has not specified a target bonus for such year, Employee’s target bonus under the Company’s annual bonus incentive plan for the last year in which the Company had specified such a target bonus, or (iii) if the Company has not specified a target bonus in the year of the Covered Termination or in a previous year, the minimum target bonus identified in Section 3.04b.

2.14

TERMINATION. The term “Termination” means Employee’s “separation from service” with the Company and all of its affiliates as that phrase is defined for purposes of Section 409A.

2.15

VOLUNTARY RESIGNATION. The term “Voluntary Resignation” means any Termination by Employee for any reason other than a Constructive Termination.

III.

EMPLOYMENT

3.01

EMPLOYMENT. Except as otherwise provided in the Agreement, the Company hereby agrees to continue to employ Employee, and Employee hereby agrees to remain in the employ of the Company, for the Employment Period. During the Employment Period, Employee shall exercise such position and authority and perform such responsibilities as are commensurate with the position to which he is assigned and as directed by the Board. The office, position and title for which Employee is initially employed is that of Chief Executive Officer.

3.02

BEST EFFORTS AND OTHER EMPLOYMENT OBLIGATIONS OF EMPLOYEE; BUSINESS EXPENSES; AND OFFICE AND OTHER SERVICES.

a.

During the Employment Period, Employee agrees that he will at all times faithfully, industriously and to the best of his ability, experience and talents, perform all of the duties that may be required of and from him pursuant to the express and implicit terms hereof.

b.

During the Employment Period, Employee shall devote his normal and regular business time, attention and skill to the business and interests of the Company, and the Company shall be entitled to all of the benefits, profits or

other issue arising from or incident to all work, services and advice of Employee performed for the Company. Such employment shall be considered “full time” employment. Employee shall also have the right to devote such incidental and immaterial amounts of his time which are not required for the full and faithful performance of his duties hereunder to any outside activities and businesses which are not being engaged in by the Company and which shall not otherwise interfere with the performance of his duties hereunder. Notwithstanding the foregoing, it shall not be a violation of the Agreement for Employee 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 significantly interfere with the performance of Employee’s responsibilities hereunder. Employee shall have the right to make investments in any business provided such investment does not result in a violation of Article V of the Agreement.

c.

Employee acknowledges and agrees that, in connection with his employment relationship with the Company, Employee owes a fiduciary duty to the Company. In keeping with these duties, Employee shall make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not appropriate for Employee’s own benefit business opportunities concerning the subject matter of the fiduciary relationship.

d.

Employee shall not intentionally take any action which he knows would not comply with the laws of the United States or any other jurisdiction applicable to Employee’s actions on behalf of the Company, and/or any of its subsidiaries or affiliates, including specifically, without limitation, the FCPA, as the FCPA may hereafter be amended, and/or its successor statutes.

e.

During and after the Employment Period, Employee agrees to refrain from any disparaging comments about the Company, any affiliates, or any current or former officer, director or employee of the Company or any affiliate, and Employee agrees not to take any action, or assist any person in taking any other action, in each case, that is materially adverse to the interests of the Company or any affiliate or inconsistent with fostering the goodwill of the Company and its affiliates; provided, however , that nothing in the Agreement shall apply to or restrict in any way the communication of information by Employee to any state or federal law enforcement agency or require notice to the Company thereof, and Employee will not be in breach of the covenant contained above solely by reason of his testimony which is compelled by process of law. During and after the Employment Period, the Company and its affiliates, officers, directors, and authorized representatives and agents agree to refrain from any disparaging comments about Employee; provided, however , that nothing in the Agreement shall apply to or restrict in any way the communication of information by the Company and its affiliates, officers, directors, and authorized representatives and agents to any state or federal law enforcement agency or require notice to Employee thereof, and the Company and its affiliates, officers, directors, and authorized representatives and agents will not be in breach of the covenant contained above solely by reason of testimony which is compelled by process of law.

f.

During the Employment Period, Employee shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by Employee in accordance with the most favorable policies, practices and procedures of the Company as in effect from time to time. Such reimbursement shall be made subject to the terms and conditions of the Company’s policy on the earlier of (i) the date specified in the Company’s policy or (ii) to the extent the reimbursement is taxable and subject to Section 409A, no later than December 31 of the calendar year next following the calendar year in which the expense was incurred.

g.

During the Employment Period, the Company shall furnish Employee with office space, secretarial assistance and such other facilities and services as shall be suitable to Employee’s position and adequate for the performance of Employee’s duties hereunder.

3.03

TERM AND EMPLOYMENT PERIOD. The period of Employee’s employment with the Company (the “Employment Period”) that commenced in accordance with the terms of the Prior Agreement will end on the date of Employee’s