2020_AGM Proxy Statement

Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE

COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934 (Amendment No.          )

 

 

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a‑6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under §240.14a‑12

 

 

 

 

 

Transocean Ltd.

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

 ☒

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Fee computed on table below per Exchange Act Rules 14a‑6(i)(1) and 0‑11.

 

(1)

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(2)

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(3)

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Total fee paid:
  

 ☐

Fee paid previously with preliminary materials.

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Check box if any part of the fee is offset as provided by Exchange Act Rule 0‑11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

(1)

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Date Filed:
  

 

 

 

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PRELIMINARY PROXY MATERIALS – SUBJECT TO COMPLETION

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TO THE OWNERS OF OUR COMPANY:

In last year’s Letter to Shareholders, we stated that “2018 may be remembered as the start of the recovery in the offshore market.” As we turn the page on 2019, we are pleased to report that we exited the year in a much more favorable environment than the one we entered.

 

BRENT CRUDE PRICES ABOVE $60/bbl

Despite intermittent fears of a global recession, Brent crude oil prices remained above $60/bbl for most of the year.

EFFICIENCIES SAFELY REDUCE COST STRUCTURE

As an industry, we continued to realize sustainable efficiencies to safely reduce offshore project costs and compress the time to first oil production, thereby improving offshore project economics and increasing the number of commercially viable offshore programs.

SHALE GROWTH DECLINES

Due to a number of challenges, including less favorable geology, accelerating decline rates, and well spacing complications, production growth from North American shale activity appears to have peaked in 2018. Shale growth noticeably slowed in 2019, and current expectations suggest that this trend will continue as we move through 2020 and beyond.

These factors, and others, have combined to enhance the attractiveness of offshore projects in our customers’ portfolios. In 2019, we observed a marked increase in customer demand, resulting in both an increase in the number of contracts awarded, and a lengthening of duration per contract. Importantly, this increase in demand was widespread, originating from private equity-backed E&P companies, to publicly traded independents, to national oil companies, to the super-majors, and spanning the world, with heightened demand in the Gulf of Mexico, Central America, Brazil, West Africa, Norway and Southeast Asia.

So, while its pace and trajectory will be largely dependent upon the health of the global economy, we believe that the offshore market is now in recovery. Marketed floater utilization exited the year at 80 percent, a 500-basis point improvement from 2018. Dayrates for harsh environment assets increased for the third consecutive year, with high-specification base dayrates now approaching U.S. $400,000 per day. Furthermore, ultra-deepwater rates are now 50 to 75 percent above prior year levels and continuing to trend higher for drilling campaigns commencing in the second half of 2020 and into 2021.

In this more constructive environment, we believe that our strategic business planning over the course of this downturn has positioned us well to continue to outperform our peer group and produce the long-term financial returns our investors trust us to deliver. We recognize that delivering these desired financial returns will occur over a multi-year recovery in the offshore space, and will demand our continued commitment to flawless execution. With the offshore industry’s highest specification floating fleet, and a steadfast focus on incident-free operations and superior well construction, we believe that we are best-positioned to support our customers in the delivery of their operational and business objectives, which will ultimately translate into solid returns for our shareholders.

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LETTER TO SHAREHOLDERS

 

 

As we enter the next decade, we are proud of the resolve our employees have demonstrated as we have confronted the challenges of the past five years. By any measure, we have delivered industry-leading results throughout the most difficult days of the offshore drilling industry’s history. In 2019, we delivered the highest Revenue, EBITDA and EBITDA Margins from a floating fleet among all offshore drilling contractors. More importantly, we delivered these results while reducing our annual total recordable incident rate by 30 percent. We are, therefore, confident going forward that this team will continue to perform at peak levels operationally, leading to improved financial results.

As part of Transocean’s Annual Report, we are pleased to recognize and thank the entire Transocean team, as we summarize our accomplishments toward furthering our company’s strategic position. During the year:

   We successfully deployed the world’s first hybrid energy storage system aboard a floating drilling unit, Transocean Spitsbergen; another first in Transocean’s history of introducing revolutionary technologies to the offshore drilling industry.

   We commenced the installation of Automated Drilling Control (“ADC”) on five additional harsh environment floaters currently on contract with Equinor, materially improving the safety and efficiency with which we deliver our customers’ wells.

   We completed the integration of Ocean Rig, recognizing the operational and cost synergies anticipated from the transaction.

   We successfully reactivated two of our newly acquired ultra-deepwater drillships, Deepwater Corcovado and Deepwater Mykonos,  both of which are now on multi-year term contracts with Petrobras in Brazil. We also successfully reactivated GSF Development Driller III for a contract in Equatorial Guinea and an upcoming campaign in Trinidad.

   We took delivery of the high-specification harsh environment Transocean Norge, and immediately placed her into operation in Norway.

   We continued to strengthen our balance sheet and extend our liquidity runway through: a) multiple timely and opportunistic financing transactions, b) exceptional operating performance throughout the year, which resulted in strong uptime for our customers and revenue efficiency in excess of 97%, and c) new contract awards, which added to our industry-leading backlog, and provide us with unparalleled visibility to future cash flows.

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LETTER TO SHAREHOLDERS

 

OFFSHORE CONTRACT DRILLING BACKLOG

 

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As of Latest Company Filings

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LETTER TO SHAREHOLDERS

 

 

AS WE ENTER 2020, WE WILL CONTINUE TO TAKE THE NECESSARY ACTIONS TO STRATEGICALLY POSITION TRANSOCEAN TO OUTPERFORM OUR PEERS AS WE CAPITALIZE ON THE IMPROVING HARSH ENVIRONMENT AND ULTRA-DEEPWATER MARKETS.

 

We continue to enhance our fleet of high-specification assets. Our fleet of 47 floaters is composed of the highest specification assets in the ultra-deepwater and harsh environment markets; this includes 28 ultra-deepwater floaters and 14 harsh environment floaters. We currently have two ultra-deepwater drillships under construction, including the industry’s first 20,000 PSI ultra-deepwater drillship, the Deepwater Titan. This rig is scheduled for delivery in 2021, at which time it will commence a five-year contract with Chevron in the U.S. Gulf of Mexico. While we have strategically added to our fleet through both acquisition and construction, we have also furthered the high-grading of our fleet through the recycling of assets. Six older, less-competitive assets were removed from our fleet in 2019, bringing the total number of floaters removed from our fleet to 53 since the downturn. Additionally, we relinquished the rights to two newbuild ultra-deepwater drillships as the remaining contractually required capital investment was prohibitive relative to the current market.

While we will continue to evaluate our fleet, and consider opportunities to enhance it, we are pleased to have assembled the largest and, more importantly, the highest specification ultra-deepwater and harsh environment floater fleet in the industry.

 

TRANSOCEAN FLEET TRANSFORMATION

 

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WE CONTINUE THE ADVANCEMENT OF OFFSHORE DRILLING THROUGH TECHNOLOGY

 

During 2019, we introduced several new technologies, including ADC, Hybrid on-board Power Plant, Haloguard and aShear. These technologies focus on the important aspects of drilling more efficient wells, ensuring the safety of our crews and the protection of the environment, while improving rig reliability, and reducing fuel consumption and emissions.

   ADC modernizes the offshore well construction process by capturing real-time downhole data that is processed via algorithms to make more efficient drilling decisions. This technology gives us a

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LETTER TO SHAREHOLDERS

 

deeper understanding of what is happening inside and around the wellbore during penetration, enabling more instantaneous reactions during the drilling operation. Ultimately, this technology takes us one step further in automating the well construction process and makes well construction safer, faster, and more reliable.

   Hybrid on-board Power is the first of its kind solution to reduce fuel consumption and emissions while providing the safety of a secondary source of power in the event of a complete loss of functionality of the rig’s engines, its primary power source. Our patented technology places battery reserves onboard to directly support each thruster rather than relying on the traditional power distribution system. The system also eliminates peak power demands on the diesel generators, allowing the engines to run more efficiently, significantly reducing fuel consumption and emissions, thus decreasing our carbon footprint. The first system was installed on the Transocean Spitsbergen, a harsh environment semisubmersible operating offshore Norway. We believe this technology can be implemented on many assets across our fleet.

   Haloguard’s development focuses on protecting the most important assets on the rig, our people. Even with well-trained employees, robust policies, and procedural discipline, it is possible for people to unintentionally place themselves at risk around moving equipment. We have collaborated to pilot  Haloguard, incorporating multiple technologies to provide warnings, and if necessary, halt equipment in the event personnel unintentionally come into close proximity with moving machinery.

   aShear is a promising new technology that will provide a new level of blow out preventer (BOP) safety never before available in our industry. Consisting of a pyrotechnic shear ram, aShear is designed to cut across casing, joints, and/or tools in the wellbore and do it in a matter of milliseconds following detection of an uncontrolled wellbore release. At its core, aShear will enable an operator to seal a well instantaneously, thus controlling unexpected releases from the well. aShear is depth agnostic, retrofittable to existing BOP stacks, and through the use of military grade initiation technology, results in unparalleled reliability. aShear has been successfully tested offshore, and is now nearing deployment into the offshore market.

Through the development and deployment of these technologies that drive improvements in personnel safety, provide additional safeguards for our assets and the environments in which we operate, improve drilling efficiency for our customers, and reduce our environmental footprint, Transocean continues to demonstrate its commitment to leading the industry in both operational excellence and sustainability.

 

ESG IS ENTRENCHED IN OUR CORE VALUES AS A FOUNDATION FOR OUR CORPORATE CULTURE

 

In 2019, we published our sustainability report covering Transocean’s Environmental, Social and Governance (ESG) program activities for 2017 and 2018. This report reflects our recognition of the responsibility to continuously challenge the status quo, with a focus on ethically, safely and efficiently delivering incremental value to our shareholders. With continued engagement throughout our entire organization, joint efforts with our customers, and genuine concern for the communities and countries in which we work, we expect to be a leader in the energy industry in the furtherance of this important objective.

 

In addition, due to our geographically diverse operations, global footprint and international workforce, we carefully assess and respond to various risks as they arise, including public health issues such as COVID-19. There is no higher priority than the health and safety of our employees, customers, partners and communities, and we will remain acutely focused on the proper management of these issues.

 

WITH 2019 NOW BEHIND US, WE LOOK FORWARD TO THE OPPORTUNITIES OF 2020.

 

As the early stages of an ultra-deepwater market recovery continue to develop; and the multi-year recovery of the harsh environment market strengthens, we remain committed to being prudent in our management of Transocean. We have taken the opportunities to strengthen our fleet, while continuing to opportunistically de-risk our balance sheet and enhance our liquidity position – a position that will be challenged in the near-term, as we take delivery of our final two newbuild ultra-deepwater drillships, and then improve at a more accelerated

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LETTER TO SHAREHOLDERS

 

 

rate as our capex obligations are significantly reduced, and these rigs begin operating and generating significant cashflow. All the while, we continue to focus on operational excellence and remaining our customer’s first choice for the most demanding and challenging offshore drilling operations across their vast portfolios.

 

We thank you, our shareholders, on behalf of our entire team at Transocean, for your continued support and trust. We look forward to fulfilling our leadership role in better meeting the world’s energy needs.

 

 

 

 

 

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ChaDWICK C. Deaton

    

Jeremy D. Thigpen

Chair of the Board of Directors

 

President and Chief Executive Officer

March [ ], 2020]

 

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CONTENTS

P-ii

NOTICE TO SHAREHOLDERS

P-iv

PROXY STATEMENT SUMMARY

P-1

INVITATION TO 2020 ANNUAL GENERAL MEETING OF TRANSOCEAN LTD.

P-6

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

P-7

INFORMATION ABOUT THE MEETING AND VOTING

P-12

AGENDA ITEM 1.   APPROVAL OF THE 2019 ANNUAL REPORT, INCLUDING THE AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF TRANSOCEAN LTD. FOR FISCAL YEAR 2019 AND THE AUDITED STATUTORY FINANCIAL STATEMENTS OF TRANSOCEAN LTD. FOR FISCAL YEAR 2019

P-13

AGENDA ITEM 2.   DISCHARGE OF THE MEMBERS OF THE BOARD OF DIRECTORS AND THE EXECUTIVE MANAGEMENT TEAM FROM LIABILITY FOR ACTIVITIES DURING FISCAL YEAR 2019

P-14 

AGENDA ITEM 3.   APPROPRIATION OF ACCUMULATED LOSS FOR FISCAL YEAR 2019

P-15

AGENDA ITEM 4.   INCREASE IN TOTAL NUMBER OF SHARES AUTHORIZED FOR ISSUANCE

P-17

AGENDA ITEM 5.   INCREASE OF THE MAXIMUM NUMBER OF MEMBERS OF THE BOARD TO 12 FROM 11 FOR A LIMITED PERIOD OF TIME

P-18

AGENDA ITEM 6.   ELECTION OF 12 DIRECTORS, EACH FOR A TERM EXTENDING UNTIL COMPLETION OF THE NEXT ANNUAL GENERAL MEETING

P-34

SKILLS & EXPERIENCE MATRIX FOR INDEPENDENT DIRECTORS

P-36

AGENDA ITEM 7.   ELECTION OF THE CHAIR OF THE BOARD OF DIRECTORS FOR A TERM EXTENDING UNTIL COMPLETION OF THE NEXT ANNUAL GENERAL MEETING

P-37

AGENDA ITEM 8.   ELECTION OF THE MEMBERS OF THE COMPENSATION COMMITTEE, EACH FOR A TERM EXTENDING UNTIL COMPLETION OF THE NEXT ANNUAL GENERAL MEETING

P-38

AGENDA ITEM 9.   REELECTION OF THE INDEPENDENT PROXY FOR A TERM EXTENDING UNTIL COMPLETION OF THE NEXT ANNUAL GENERAL MEETING

P-39

AGENDA ITEM 10. APPOINTMENT OF ERNST & YOUNG LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR FISCAL YEAR 2020 AND REELECTION OF ERNST & YOUNG LTD, ZURICH, AS THE COMPANY’S AUDITOR FOR A FURTHER ONE‑YEAR TERM

P-41

AGENDA ITEM 11. ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION

P-43

AGENDA ITEM 12. PROSPECTIVE VOTES ON THE MAXIMUM COMPENSATION OF THE BOARD OF DIRECTORS AND THE EXECUTIVE MANAGEMENT TEAM

P-49

AGENDA ITEM 13. APPROVAL OF AMENDMENT AND RESTATEMENT OF THE TRANSOCEAN LTD. 2015 LONG-TERM INCENTIVE PLAN

P-57

CORPORATE GOVERNANCE

P-64 

BOARD MEETINGS AND COMMITTEES

P-71 

2019 DIRECTOR COMPENSATION

P-72

AUDIT COMMITTEE REPORT

P-74

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

P-75

SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

P-76 

COMPENSATION DISCUSSION AND ANALYSIS

P-101 

COMPENSATION COMMITTEE REPORT

P-102 

EXECUTIVE COMPENSATION

P-111 

EQUITY COMPENSATION PLAN INFORMATION

P-112 

OTHER MATTERS

A-1

APPENDIX A. NON-GAAP FINANCIAL INFORMATION

B-1

APPENDIX B – TRANSOCEAN LTD. 2015 LONG-TERM INCENTIVE PLAN AND PROPOSED AMENDMENT TO TRANSOCEAN LTD. 2015 LONG-TERM INCENTIVE PLAN

ANA-1

ANNEX A – PROPOSED AMENDMENT TO ARTICLE 38 OF THE COMPANY’S ARTICLES OF ASSOCIATION

ANB-1

ANNEX B – PROPOSED AMENDMENT TO ARTICLE 5 OF THE COMPANY’S ARTICLES OF ASSOCIATION

 

 

Transocean 2020    i    Proxy Statement

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NOTICE TO SHAREHOLDERS

The 2020 annual general meeting of the shareholders (the “2020 Annual General Meeting”) of Transocean Ltd. (the “Company”) will be held:

 

 

 

 

 

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WHEN

WHERE

Thursday, May 7, 2020

Parkhotel Zug

6:30 p.m., Swiss time

Industriestrasse 14

 

6304 Zug, Switzerland

 

Information regarding the matters to be acted upon at the meeting is set forth in the attached invitation to the 2020 Annual General Meeting and the proxy statement, which is available at: www.deepwater.com by selecting Financial Reports, Annual and Quarterly Reports in the dropdown of the Investors section.

At the 2020 Annual General Meeting, we will ask you to vote on the following items:

 

 

 

 

 

 

 

AGENDA
ITEM

  

DESCRIPTION

  

BOARD
RECOMMENDATION

  

FOR MORE INFORMATION, SEE PAGE

1

 

Approval of the 2019 Annual Report, Including the Audited Consolidated Financial Statements of Transocean Ltd. for Fiscal Year 2019 and the Audited Statutory Financial Statements of Transocean Ltd. for Fiscal Year 2019

 

 

 

FOR

 

P-12

2

 

Discharge of the Members of the Board of Directors and Executive Management Team from Liability for Activities During Fiscal Year 2019

 

 

 

FOR

 

P-13

3

 

Appropriation of the Accumulated Loss for Fiscal Year 2019

 

 

 

FOR

 

P-14

4

 

Increase in Total Number of Shares Authorized for Issuance

 

 

 

FOR

 

P-15

5

 

Increase of the Maximum Number of Members of the Board of Directors to 12 from 11 for a Limited Period of Time

 

 

 

FOR

 

P-17

6

 

Election of 12 Directors, Each for a Term Extending Until Completion of the Next Annual General Meeting

 

 

 

FOR

 

P-18

7

 

Election of the Chair of the Board of Directors for a Term Extending Until Completion of the Next Annual General Meeting

 

 

 

FOR

 

P-36

8

 

Election of the Members of the Compensation Committee, Each for a Term Extending Until Completion of the Next Annual General Meeting

 

 

 

FOR

 

P-37

9

 

Reelection of the Independent Proxy for a Term Extending Until Completion of the Next Annual General Meeting

 

 

 

FOR

 

P-38

10

 

Appointment of Ernst & Young LLP as the Company’s Independent Registered Public Accounting Firm for Fiscal Year 2020 and Reelection of Ernst & Young Ltd, Zurich, as the Company’s Auditor for a Further One‑Year Term

 

 

 

FOR

 

P-39 

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NOTICE TO SHAREHOLDERS

 

11

 

Advisory Vote to Approve Named Executive Officer Compensation

 

 

 

FOR

 

P-41

12

 

Prospective Votes on the Maximum Compensation of the Board of Directors and the Executive Management Team

 

 

 

FOR

 

P-43

13

 

Approval of Amendment and Restatement of the Transocean Ltd. 2015 Long-Term Incentive Plan

 

 

 

FOR

 

P-49

It is important that your shares be represented and voted at the meeting, whether you plan to attend or not. If you are a shareholder registered in our share register, you may submit voting instructions electronically over the internet, by telephone or, if you request that the proxy materials be mailed to you, by completing, signing and returning the proxy card enclosed with those materials. If you hold your shares in the name of a bank, broker or other nominee, please follow the instructions provided by your bank, broker or nominee for submitting voting instructions, including whether you may submit voting instructions by mail, telephone or over the internet.

Under rules of the U.S. Securities and Exchange Commission (“SEC”), we have elected to provide access to our proxy materials over the internet. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to our shareholders as of the close of business on March 2, 2020. All shareholders will have the ability to access the proxy materials on the website referred to in the Notice or to request to receive a printed set of the proxy materials. Instructions on how to access the proxy materials over the internet or to request a printed copy may be found in the Notice. The Notice also instructs you on how you may submit your proxy over the internet, by telephone or via mail. If you receive the Notice, you will not receive a printed copy of the proxy materials unless you request one in the manner set forth in the Notice or as otherwise described in the proxy statement.

A copy of the proxy materials, including a proxy card or voting instruction form, will also be sent to any additional shareholders who are registered in our share register as shareholders with voting rights, or who become beneficial owners through a nominee registered in our share register as a shareholder with voting rights, as of the close of business on April 20, 2020, and who were not registered as of March 2, 2020. The Notice or proxy statement and form of proxy, as appropriate, are first being mailed or sent, as appropriate, to shareholders on or about March [ ], 2020.

A note to Swiss and other European investors: Transocean Ltd. is incorporated in Switzerland, has issued registered shares and trades on the New York Stock Exchange; however, unlike some Swiss incorporated companies, share blocking and re‑registration are not requirements for any shares of Transocean Ltd. to be voted at the meeting, and all shares may be traded after the record date.

Thank you in advance for your vote.

Sincerely,

 

 

 

 

 

Picture 229827

 

 

Picture 229828

 

ChaDWICK C. Deaton

    

Jeremy D. Thigpen

Chair of the Board of Directors

 

President and Chief Executive Officer

 

March [ ], 2020

 

 

 

Transocean 2020    iii    Proxy Statement

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PROXY STATEMENT SUMMARY

2019 ANNUAL GENERAL MEETING DETAILS

 

 

 

 

 

Picture 6

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Picture 17

WHEN

WHERE

RECORD DATE

Thursday, May 7, 2020

Parkhotel Zug

April 20, 2020

6:30 p.m., Swiss time

Industriestrasse 14

 

 

6304 Zug, Switzerland

 

 

VOTING

 

 

 

 

 

 

 

 

 

 

 

 

 

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Picture 229868

 

Picture 229869

 

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BY PHONE

 

BY INTERNET

 

BY MAIL

 

BY MOBILE DEVICE

 

IN PERSON

 

 

 

 

 

 

 

 

 

 

 

Registered Holders

(shares are registered in your own name)

 

On a touch‑tone telephone, call toll‑free
+1 (800) 690‑6903 24/7, and follow the instructions.

 

You will need the 12‑digit control number that is included in the voting instructions form that is sent to you.

 

You will be able to confirm that the telephonic system has properly recorded your votes.

 

Go to www.proxyvote.com 24/7, and follow the instructions.

 

You will need the 12‑digit control number that is included in the voting instructions form that is sent to you.

 

The internet system allows you to confirm that the system has properly recorded your voting instructions.

 

Complete, date, sign and return your proxy card in the postage-paid envelope.

 

Do not mail the proxy card if you are submitting voting instructions over the internet.

 

Scan the QR code, which can be found on your voting instructions form that is sent to  you.

 

Picture 231184

 

Attend the Annual Meeting and vote by ballot.

 

You will need to present a valid government-issued  photo ID and either the Notice or proxy card.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beneficial Owners

(shares are held “in street name” in a stock brokerage account or by a bank, nominee or other holder of record)

 

On a touch‑tone telephone, call toll‑free
+1 (800) 690‑6903 24/7, and follow the instructions.

 

You will need the 12‑digit control number that is included in the voting instructions form that is sent to you.

 

You will be able to confirm that the telephonic system has properly recorded your votes.

 

Go to www.proxyvote.com 24/7, and follow the instructions.

 

You will need the 12‑digit control number that is included in the voting instruction form that is sent to you.

 

The internet system allows you to confirm that the system has properly recorded your voting instructions.

 

Complete, date, sign and return your voting information form.

 

Do not mail the voting instruction form if you are submitting voting instructions over the internet or by telephone.

 

Scan the QR code, which can be found on your voting instructions form that is sent to you.

 

Picture 231183

 

Attend the Annual Meeting and vote by ballot.

 

You will need to present a valid government-issued photo ID and a legal proxy issued by your bank, broker or other nominee.

Transocean 2020    iv    Proxy Statement

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PROXY STATEMENT SUMMARY

 

Transocean is a leading international provider of offshore contract drilling services for oil and gas wells. The company specializes in technically demanding sectors of the global offshore drilling business with a particular focus on deepwater and harsh environment drilling services, and believes that it operates the highest specification floating offshore drilling fleet in the world.

Transocean owns or has partial ownership interests in, and operates a fleet of 45 mobile offshore drilling units consisting of 28 ultra-deepwater floaters, 14 harsh environment floaters, and three midwater floaters. In addition, Transocean is constructing two ultra-deepwater drillships.

With the offshore industry’s highest specification floating fleet, and a steadfast focus on incident-free operations and superior well construction, we believe that we are best-positioned to support our customers in the delivery of their operational and business objectives, which will ultimately translate into solid returns for our shareholders.

As we enter the next decade, we are proud of the resolve our employees have demonstrated as we have confronted the challenges of the past five years. By any measure, we have delivered industry-leading results throughout the most difficult days of the offshore drilling industry’s history. In 2019, we delivered the highest Revenue, EBITDA and EBITDA Margins from a floating fleet among all offshore drilling contractors. More importantly, we delivered these results while reducing our annual total recordable incident rate by 30 percent. We are, therefore, confident going forward that this team will continue to perform at peak levels operationally, leading to improved financial results.

 

YOUR VOTE IS IMPORTANT

Even if you plan to attend the annual meeting, we encourage you to vote as soon as possible.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE 2020 ANNUAL GENERAL MEETING TO BE HELD ON MAY 7, 2020

Our proxy statement and 2019  Annual Report are available at www.proxyvote.com or on our website investor.deepwater.com under “Financial Reports ― Annual and Quarterly Reports.”

 

Shareholders registered in our share register on the record date have the right to attend the 2020 Annual General Meeting and vote their shares. Such shareholders may designate proxies to vote their shares by submitting their proxy electronically over the internet, by telephone or, if they request that the proxy materials be mailed to them, by completing, signing and returning the proxy card enclosed with those materials. Please review the voting instructions in the proxy statement for each of these methods.

Shareholders who hold their shares in the name of a bank, broker or other nominee should follow the instructions provided by their bank, broker or nominee for voting their shares, including whether they may submit voting instructions by mail, telephone or over the internet.

Shareholders who wish to attend and vote at the meeting in person are required to present either the Notice, or any proxy card that is sent to them, or, if they hold their shares in the name of a bank, broker or other nominee, a legal proxy issued by their bank, broker or other nominee in their name, each with proof of identification. All dollar figures in this proxy statement are in U.S. dollars unless otherwise denoted.

 

NOMINEES TO THE BOARD OF DIRECTORS

Among the proposals shareholders are being asked to vote on is an increase in the maximum number of members of the Board of Directors to 12 directors for a limited period of time. This proposal, if adopted, will allow us to enhance the skills, experience and diversity among our directors, allow the Board of Directors to maintain committees of an appropriate size and composition, and provide for an orderly transition for retirements anticipated in three-to-four years. Assuming this proposal is approved by our shareholders and that

Transocean 2020    v    Proxy Statement

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PROXY STATEMENT SUMMARY

 

 

all of the nominees proposed by the Board of Directors are elected at our 2020 Annual General Meeting, our Board of Directors will have 12 members. Two new highly-qualified nominees are on our director slate: Diane de Saint Vincent, who has over 30 years of experience across various industries and most recently served as General Counsel of ABB from 2007 to 2019; and Peter Goode, who is Chair of the Board and founder of GR Energy Services, a private oil and gas services company. Mr. Goode has more than 40 years of experience in the oilfield services industry and international experience at the Board level and in senior management.

 

Each of our director nominees has a proven record of success, high integrity, an appreciation for diversity, and is committed to taking action to advance and increase the Company’s sustainability efforts.

 

During 2019, each of our current directors attended 100% of the Board of Directors’ meetings and committee meetings on which he or she served during his or her elected term. Additional information regarding the nominees for election is provided under Agenda Item 6.

Transocean 2020    vi    Proxy Statement

Table of Contents

 

 

 

PROXY STATEMENT SUMMARY

 

 

 

 

 

 

 

COMMITTEES

OTHER
CURRENT
PUBLIC
COMPANY
BOARDS

DIRECTORS FOR ELECTION

AGE

DIRECTOR
SINCE

INDEPENDENT

AUDIT

 COMPENSATION 

FINANCE

CORPORATE
  GOVERNANCE   

HEALTH,
SAFETY AND
 ENVIRONMENTAL 

Picture 229859

Glyn A. Barker

Former Vice Chair-U.K., PwC LLP

66

2012

Picture 231222

Picture 231194

 

Picture 229877

 

 

3

Picture 229855

Vanessa C.L. Chang

Former Director and Shareholder of EL & EL Investments

67

2012

Picture 229887

Picture 231205

 

 

Picture 229878

 

3

Picture 229851

Frederico F. Curado

CEO, Ultrapar S.A.

58

2013

 

 

 

 

Picture 16

Picture 20

1

Picture 229847

Chadwick C. Deaton

Former Executive Chair and CEO, Baker Hughes Incorporated

67

2012

 

 

 

 

 

3

Picture 229833

Peter A. Goode

Board Chair, GR Energy Services

63

Nominee

 

 

 

 

 

0

Picture 229844

Vincent J. Intrieri

Founder and CEO, VDA Capital Management LLC

63

2014

 

Picture 229880

Picture 229881

Picture 231219

 

2

Picture 229840

Samuel J. Merksamer

Partner, Caligan Partners, L.P.

39

2013

 

Picture 22

Picture 229882

 

 

0

Picture 229837

Frederik W. Mohn

Owner and Managing Director, Perestroika; former Director and Chair, Songa Offshore SE

43

2018

Picture 231182

Picture 231207

 

 

 

Picture 229884

2

Picture 231231

Edward R. Muller

Former Chair and CEO, GenOn Energy, Inc.; former Vice Chair, NRG Energy, Inc.

67

2008

Picture 231169

Picture 231168

 

Picture 231220

 

 

1

Picture 21

Diane de Saint Victor

Company Secretary of ABB Ltd, Switzerland

 

65

Nominee

Picture 229835

 

 

 

 

2

Picture 231227

Tan Ek Kia

Former Chair, Shell Northeast Asia

71

2011

 

Picture 231221

 

 

Picture 229886

3

Transocean 2020    vii    Proxy Statement

Table of Contents

 

 

PROXY STATEMENT SUMMARY

 

 

Picture 231178

Jeremy D. Thigpen

President and CEO, Transocean Ltd.

45

2015

 

 

 

 

 

 

0

 

MEETINGS IN 2019:     BOARD:   4
TOTAL NUMBER OF MEETINGS IN 2019:  28

8

4

4

4

4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Picture 231213

Committee Chair

 

Picture 231193

Committee Member

 

Picture 231212

Audit Committee financial expert (SEC and NYSE)

 

 

Independent, as determined by the Board of Directors in accordance with applicable rules and regulations

SWISS MINDER ORDINANCE

Under the Swiss Ordinance Against Excessive Compensation At Public Companies (the “Minder Ordinance”) and our Articles of Association, the authority to elect the Chair of the Board of Directors and the members of the Compensation Committee is vested in the general meeting of shareholders. The Board of Directors recommends that you elect Chadwick C. Deaton as Chair of the Board of Directors (Agenda Item 7) and Glyn A. Barker, Peter A. Goode (subject to his election as a director), Samuel J. Merksamer and Tan Ek Kia as members of the Compensation Committee (Agenda Item 8) to serve until completion of the 2021 annual general meeting of the shareholders (the “2021 Annual General Meeting”). Note that under the Minder Ordinance and our Articles of Association, if any of these individuals were to resign or there were vacancies in the office of the Chair or the Compensation Committee for other reasons, the Board of Directors would have the authority to replace him or her with another member of the Board of Directors for a term expiring at the next annual general meeting.

Pursuant to the Minder Ordinance, the Company is not permitted to appoint a corporate representative to act as the proxy for purposes of voting at the 2020 Annual General Meeting. Swiss companies may only appoint an independent proxy for these purposes. At the 2019 annual general meeting of the shareholders (the “2019 Annual General Meeting”), shareholders elected Schweiger Advokatur / Notariat to serve as our independent proxy for a term extending until the completion of the 2020 Annual General Meeting. Agenda Item 8 asks that you again elect this firm to act as the independent proxy for the 2021 Annual General Meeting and any extraordinary general meeting of shareholders of the Company that may be held prior to the 2021 Annual General Meeting.

The Minder Ordinance and our Articles of Association also require that the shareholders ratify the maximum aggregate amount of compensation of the Board of Directors for the period between the 2020 Annual General Meeting and the 2021 Annual General Meeting (Agenda Item 12A) and the maximum aggregate amount of compensation of the Executive Management Team for fiscal year 2021 (Agenda Item 12B). The shareholder vote is binding.

ACTIVE SHAREHOLDER ENGAGEMENT PROGRAM

As part of our ongoing shareholder engagement program, our Board of Directors and Management team are committed to meeting with our shareholders and incorporating their feedback into our decision-making processes. In late 2019, we engaged with shareholders representing more than 25% of our outstanding shares to discuss recent developments and to solicit investor feedback on our corporate governance, executive compensation, and sustainability practices. In addition to these topics, we also discussed the robust qualifications and capabilities of one of our independent directors, Mr. Curado, to address concerns regarding his ability to serve effectively as an independent director in light of his external commitments. Participants in some of the engagements included our Chief Executive Officer, Independent Chair, and Chair of the Corporate Governance Committee, in addition to members of executive management. All feedback received has been shared directly with the Board and has helped inform material governance, compensation and sustainability considerations.

Transocean 2020    viii    Proxy Statement

Table of Contents

 

 

 

PROXY STATEMENT SUMMARY

 

FEATURES OF EXECUTIVE COMPENSATION PROGRAM

Our executive compensation program reflects our commitment to retain and attract highly qualified executives. The elements of our program are designed to motivate our executives to achieve our overall business objectives and create sustainable shareholder value in a cost‑effective manner and reward our management team for delivering superior financial, safety and operational performance, each of which is important to the long‑term success of the Company. We feel strongly that our executive compensation program includes features that align the interests of our senior management with those of our shareholders and excludes features that may result in misalignment.

 

 

 

 

 

 

WHAT WE DO

    

    

WHAT WE DON’T DO

✓    Conduct an annual review of our compensation strategy, including a review of our compensation-related risk profile

✓    Mandate meaningful share ownership requirements for our executives

✓    Maintain a clawback policy that allows for the forfeiture, recovery or adjustment of incentive compensation (cash and equity)

✓    Base annual and long-term incentive payments on quantitative, formulaic metrics

✓    Maintain compensation plans that are weighted significantly toward variable pay to align our executive compensation with long-term shareholder interests

✓    Link long-term incentive compensation to relative performance metrics to motivate strong performance

✓    Deliver at least 50% of long-term incentives in performance-based equity awards

✓    Retain an independent consultant who is, retained by and reports only to, our Compensation Committee (not management)

✓    Maintain double trigger change-in-control provisions

 

 

   Allow our executives to hedge, sell short or hold derivative instruments tied to our shares (other than derivative instruments issued by us)

   Allow our executives or directors to pledge Company shares

   Have pre-arranged individual severance agreements or special change-in-control compensation agreements with any Executive Officers; however, to the extent permitted under Swiss law, our executives are eligible for severance and change-in-control provisions pursuant to our policies, in exchange for covenants that protect the Company

   Provide gross-ups for severance payments

   Guarantee salary increases, non-performance based bonuses or unrestricted equity compensation

   Provide any payments or reimbursements for tax equalization

   Pay dividend equivalents on performance-based equity that has not vested

   Offer executive perquisites

 

 

 

Transocean 2020    ix    Proxy Statement

Table of Contents

 

INVITATION TO 2020 ANNUAL GENERAL MEETING OF TRANSOCEAN LTD.

 

 

 

 

Picture 229849

 

Picture 229850

WHEN

 

WHERE

Thursday, May 7, 2020

6:30 p.m., Swiss time

 

Parkhotel Zug

Industriestrasse 14

6304 Zug, Switzerland

 

AGENDA ITEMS

 

 

 

 

 

 

 

ITEM

 

DESCRIPTION

 

PROPOSAL OF THE BOARD OF DIRECTORS

 

BOARD
RECOMMENDATION

1

 

Approval of the 2019 Annual Report, Including the Audited Consolidated Financial Statements of Transocean Ltd. for Fiscal Year 2019 and the Audited Statutory Financial Statements of Transocean Ltd. for Fiscal Year 2019.

 

The Board of Directors proposes that the 2019 Annual Report, including the audited consolidated financial statements for the year ended December 31 (“fiscal year”) 2019, and the audited statutory financial statements for fiscal year 2019, be approved.

 

 

 

FOR

 

 

 

 

 

 

 

2

 

Discharge of the Members of the Board of Directors and the Executive Management Team from Liability for Activities During Fiscal Year 2019.

 

The Board of Directors proposes that the members of the Board of Directors and Messrs. Jeremy D. Thigpen, Mark L. Mey, Keelan I. Adamson, who served as members of our Executive Management Team in 2019, be discharged from liability for activities during fiscal year 2019.

 

 

 

FOR

 

 

 

 

 

 

 

3

 

Appropriation of Accumulated Loss for Fiscal Year 2019.

 

The Board of Directors proposes that the accumulated loss of the Company be carried forward.

 

 

 

FOR

 

 

 

 

APPROPRIATION OF
ACCUMULATED LOSS

 

IN CHF
THOUSANDS

 

 

 

 

 

 

Balance brought forward from previous years

 

(5,896,213)

 

 

 

 

 

 

Net loss of the year

 

(1,378,613)

 

 

 

 

 

 

Total accumulated loss

 

(7,274,826)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

APPROPRIATION OF
ACCUMULATED LOSS

 

 

 

 

 

 

 

 

Balance to be carried forward on this account

 

(7,274,826)

 

 

 

 

 

 

 

 

 

4

 

Increase in Total Number of Shares Authorized for Issuance.

 

The Board of Directors proposes to increase the total number of shares that may be issued using the Company’s authorized share capital to a maximum of 184,974,503 shares, with such authorization expiring on May 7, 2022.

 

 

 

FOR

 

 

 

 

 

 

 

 

5

 

Amendment of the Articles of Association to Increase the Maximum Number of Members of the Board of Directors to 12 from 11 for a Limited Period of Time

 

The Board of Directors proposes that the maximum number of members of the Board of Directors under the Articles of Association be increased to 12 from 11 members. The proposed amendments to the Articles of Association are attached as Annex A.

 

 

 

 FOR

Transocean 2020    P-1    Proxy Statement

Table of Contents

 

 

INVITATION TO 2020 ANNUAL GENERAL MEETING OF TRANSOCEAN LTD.

 

 

 

 

 

 

 

 

 

ITEM

 

DESCRIPTION

 

PROPOSAL OF THE BOARD OF DIRECTORS

 

BOARD
RECOMMENDATION

6

 

Election of 12 Directors, Each for a Term Extending Until Completion of the Next Annual General Meeting.

 

The Board of Directors proposes that the following candidates be elected to the Board of Directors, each for a term extending until completion of the next annual general meeting.

 

 

 

FOR

 

 

 

 

 

 

 

 

 

 

 

 

6A  

Election of Glyn A. Barker as a director.

 

 

 

 

 

 

6B  

Election of Vanessa C.L. Chang as a director.

 

 

 

 

 

 

6C  

Election of Frederico F. Curado as a director.

 

 

 

 

 

 

6D  

Election of Chadwick C. Deaton as a director.

 

 

 

 

 

 

6E  

Election of Peter A. Goode as a director.

 

 

 

 

 

 

6F  

Election of Vincent J. Intrieri as a director.

 

 

 

 

 

 

6G  

Election of Samuel J. Merksamer as a director.

 

 

 

 

 

 

6H  

Election of Frederik W. Mohn as a director.

 

 

 

 

 

 

6I  

Election of Edward R. Muller as a director.

 

 

 

 

 

 

6J  

Election of Diane de Saint Victor as a director.

 

 

 

 

 

 

6K  

Election of Tan Ek Kia as a director.

 

 

 

 

 

 

6L  

Election of Jeremy D. Thigpen as a director.

 

 

 

 

 

 

 

 

 

7

 

Election of the Chair of the Board of Directors for a Term Extending Until Completion of the Next Annual General Meeting.

 

The Board of Directors proposes that Chadwick C. Deaton be elected as the Chair of the Board of Directors for a term extending until completion of the next annual general meeting, subject to his reelection as a member of the Board of Directors.

 

 

 

FOR

 

 

 

 

 

 

 

8

 

Election of the Members of the Compensation Committee, Each for a Term Extending Until Completion of the Next Annual General Meeting.

 

The Board of Directors proposes that the following four candidates be elected as members of the Compensation Committee, each for a term extending until completion of the next annual general meeting, subject in each case to such candidate’s reelection as a member of the Board of Directors:

 

 

 

FOR

each nominee

 

 

 

 

8A  

Election of Glyn A. Barker as a member of the Compensation Committee.

 

 

8B  

Election of Peter A. Goode as a member of the Compensation Committee.

8C  

Election of Samuel J. Merksamer as a member of the Compensation Committee.

8D  

Election of Tan Ek Kia as a member of the Compensation Committee.

 

 

 

 

 

 

 

 

9

 

Reelection of the Independent Proxy for a Term Extending Until Completion of the Next Annual General Meeting.

 

The Board of Directors proposes that Schweiger Advokatur / Notariat be reelected to serve as independent proxy at (and until completion of) the 2021 Annual General Meeting and at any extraordinary general meeting of shareholders of the Company that may be held prior to the 2021 Annual General Meeting.

 

 

 

 FOR

 

 

 

 

 

 

 

Transocean 2020    P-2    Proxy Statement

Table of Contents

 

 

 

INVITATION TO 2020 ANNUAL GENERAL MEETING OF TRANSOCEAN LTD.

 

 

 

 

 

 

 

 

ITEM

 

DESCRIPTION

 

PROPOSAL OF THE BOARD OF DIRECTORS

 

BOARD
RECOMMENDATION

10

 

Appointment of Ernst & Young LLP as the Company’s Independent Registered Public Accounting Firm for Fiscal Year 2020 and Reelection of Ernst & Young Ltd, Zurich, as the Company’s Auditor for a Further One‑Year Term.

 

The Board of Directors proposes that Ernst & Young LLP be appointed as the Company’s independent registered public accounting firm for fiscal year 2020 and that Ernst & Young Ltd, Zurich, be reelected as the Company’s auditor pursuant to the Swiss Code of Obligations for a further one‑year term, commencing on the date of the 2020 Annual General Meeting and terminating on the date of the 2021 Annual General Meeting.

 

 

 

FOR

 

 

 

 

 

 

 

11

 

Advisory Vote to Approve Named Executive Officer Compensation for Fiscal Year 2020.

 

Pursuant to Section 14A of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), shareholders are entitled to cast an advisory vote on the Company’s executive compensation program for the Company’s Named Executive Officers. Detailed information regarding the Company’s compensation program for its Named Executive Officers is set forth in the Compensation Discussion and Analysis, the accompanying compensation tables and the related narrative disclosure in this proxy statement. The Board of Directors believes the Company’s compensation program is designed to reward performance that creates long term value for the Company’s shareholders. The Board of Directors has proposed a resolution that provides shareholders with the opportunity to endorse or not endorse the Company’s Named Executive Officer compensation program as described in the proxy statement for the Company’s 2020 Annual General Meeting.

 

 

 FOR

 

 

 

 

 

 

 

 

12

 

Prospective Vote on the Maximum Compensation of the Board of Directors and the Executive Management Team.

 

 

 

 

 

 

 

 

 

 

 

 

 

12A

 

Ratification of the Maximum Aggregate Amount of Compensation of the Board of Directors for the Period Between the 2020 Annual General Meeting and the 2021 Annual General Meeting.

 

The Board of Directors proposes that the shareholders ratify an amount of U.S. $4,300,000 as the maximum aggregate amount of compensation of the Board of Directors for the period between the 2020 Annual General Meeting and the 2021 Annual General Meeting.

 

 

 

FOR

 

 

 

 

 

 

 

12B

 

Ratification of the Maximum Aggregate Amount of Compensation of the Executive Management Team for Fiscal Year 2021.

 

The Board of Directors proposes that the shareholders ratify an amount of U.S. $24,000,000 as the maximum aggregate amount of compensation of the Executive Management Team for fiscal year 2021.

 

 

 

FOR

 

 

 

 

 

 

 

 

13

 

Approval of Amendment and Restatement of the Transocean Ltd. 2015 Long-Term Incentive Plan

 

The Board of Directors proposes that the shareholders approve an amendment to the Transocean Ltd. 2015 Long-Term Incentive Plan for additional reserves in the aggregate amount of 24,000,000 shares issuable pursuant to the Transocean Ltd. 2015 Long-Term Incentive Plan, as amended (“2015 LTIP”), which was originally approved by shareholders on May 15, 2015.

 

 

 

FOR

Transocean 2020    P-3    Proxy Statement

Table of Contents

 

 

INVITATION TO 2020 ANNUAL GENERAL MEETING OF TRANSOCEAN LTD.

 

 

ORGANIZATIONAL MATTERS

A copy of the Notice is being sent to each shareholder registered in Transocean Ltd.’s share register as of the close of business on March 2, 2020. Any additional shareholders who are registered in Transocean Ltd.’s share register as of the close of business on April 20, 2020, will receive after that date a copy of the proxy materials, including a proxy card. Shareholders not registered in Transocean Ltd.’s share register as of April 20, 2020, will not be entitled to attend, vote or grant proxies to vote at the 2020 Annual General Meeting. While no shareholder will be entered in Transocean Ltd.’s share register as a shareholder with voting rights between the close of business on April 20, 2020, and the opening of business on the day following the 2020 Annual General Meeting, share blocking and re‑registration are not requirements for any shares of Transocean Ltd. to be voted at the meeting, and all shares may be traded after the record date. Computershare, which maintains Transocean Ltd.’s share register, will continue to register transfers of Transocean Ltd. shares in the share register in its capacity as transfer agent during this period.

Shareholders registered in Transocean Ltd.’s share register as of April 20, 2020, have the right to attend the 2020 Annual General Meeting and vote their shares (in person or by proxy), or may grant a proxy to vote on each of the proposals in this invitation and any modification to any agenda item or proposal identified in this invitation or other matter on which voting is permissible under Swiss law and which is properly presented at the 2020 Annual General Meeting for consideration. Such shareholders may designate proxies to vote their shares electronically over the internet, by telephone or, if they request that the proxy materials be mailed to them, by completing, signing and returning the proxy card enclosed with those materials at the 2020 Annual General Meeting. Even if you plan to attend the 2020 Annual General Meeting, we encourage you to submit your voting instructions prior to the meeting.

We urge you to submit your voting instructions electronically over the internet or return the proxy card as soon as possible. All electronic voting instructions or proxy cards must be received no later than 11:59 p.m. Eastern Daylight Time on Wednesday, May 6, 2020 (5:59 a.m. Swiss time on Thursday, May 7, 2020) unless extended by the Company.

If you have timely submitted electronic voting instructions, telephone instructions or a properly executed proxy card, your shares will be voted by the independent proxy in accordance with your instructions. Holders of shares who have timely submitted their proxy, but have not specifically indicated how to vote their shares, will be deemed to have instructed the independent proxy to vote in accordance with the recommendations of the Board of Directors with regard to the items listed in the notice of meeting. If any modifications to agenda items or proposals identified in this invitation or other matters on which voting is permissible under Swiss law are properly presented at the 2020 Annual General Meeting for consideration, you will be deemed to have instructed the independent proxy, in the absence of other specific instructions, to vote in accordance with the recommendations of the Board of Directors.

As of the date of this proxy statement, the Board of Directors is not aware of any such modifications or other matters proposed to come before the 2020 Annual General Meeting.

Shareholders who hold their shares in the name of a bank, broker or other nominee should follow the instructions provided by their bank, broker or nominee for voting their shares, including whether they may submit voting instructions by mail, telephone or over the internet.

Shareholders may grant proxies to any third party. Such third party need not be a shareholder.

Directions to the 2020 Annual General Meeting can be obtained by contacting:

 

 

 

 

 

Picture 8

OUR CORPORATE SECRETARY
AT OUR REGISTERED
OFFICE

Transocean Ltd.

Attention: Corporate Secretary

Turmstrasse 30

6312 Steinhausen, Switzerland

 

 Picture 229836

INVESTOR RELATIONS AT
OUR OFFICES
IN THE UNITED STATES

Transocean Ltd.

Attention: Investor Relations

1414 Enclave Parkway

Houston, Texas 77077

USA

Transocean 2020    P-4    Proxy Statement

Table of Contents

 

 

 

INVITATION TO 2020 ANNUAL GENERAL MEETING OF TRANSOCEAN LTD.

 

 

 

 

 

 

 

 

Picture 229846

TELEPHONE
NUMBER 

+41 (41) 749-0500

 

 Picture 229852

TELEPHONE
NUMBER
 

+1 (713) 232‑7500

 

If you plan to attend and vote at the 2020 Annual General Meeting in person, you are required to present either the Notice or any proxy card that is sent to you, together with proof of identification, or, if you own shares held in the name of a bank, broker or other nominee, a legal proxy issued by your bank, broker or other nominee in your name, together with proof of identification. If you plan to attend the 2020 Annual General Meeting in person, we urge you to arrive at the meeting location no later than 6:30 p.m., Swiss time on Thursday, May 7, 2020. In order to determine attendance correctly, any shareholder leaving the 2020 Annual General Meeting early or temporarily, will be requested to present such shareholder’s admission card upon exit.

ANNUAL REPORT, CONSOLIDATED FINANCIAL STATEMENTS, STATUTORY FINANCIAL STATEMENTS

A copy of the 2019 Annual Report (including the consolidated financial statements for fiscal year 2019, the statutory financial statements of Transocean Ltd. for fiscal year 2019 and the audit reports on such consolidated and statutory financial statements) and the 2019 Swiss Compensation Report is available for physical inspection at our registered office:

 

 

Picture 229848

Transocean Ltd.

Turmstrasse 30

6312 Steinhausen, Switzerland

 

Copies of these materials may be obtained without charge by contacting:

 

 

 

 

 

Picture 229854

OUR CORPORATE SECRETARY
AT OUR REGISTERED
OFFICE

Transocean Ltd.

Attention: Corporate Secretary

Turmstrasse 30

6312 Steinhausen, Switzerland

 

 Picture 229853

INVESTOR RELATIONS AT
OUR OFFICES
IN THE UNITED STATES

Transocean Ltd.

Attention: Investor Relations

1414 Enclave Parkway

Houston, Texas 77077

USA

 

 

 

 

 

 

 

Picture 229856

TELEPHONE
NUMBER 

+41 (41) 749-0500

 

 Picture 229857

TELEPHONE
NUMBER
 

+1 (713) 232‑7500

 

 

 

 

On behalf of the Board of Directors,

 

 

 

 

 

CHADWICK C. DEATON
Chair of the Board of Directors

 

Steinhausen, Switzerland

March [ ], 2020

 

 

Transocean 2020    P-5    Proxy Statement

Table of Contents

 

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

 

YOUR VOTE IS IMPORTANT

You may designate a proxy to vote your shares by submitting your voting instructions electronically over the internet, by calling the toll-free number or, if you requested a printed copy of the proxy materials, by completing, signing and returning by mail the proxy card you will receive in response to your request. Please review the instructions in the Notice of Internet Availability of Proxy Materials and the proxy statement.

Shareholders who hold their shares in the name of a bank, broker or other nominee should follow the instructions provided by their bank, broker or nominee for voting their shares, including whether they may submit voting instructions by mail, telephone or over the internet.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE 2020 ANNUAL GENERAL MEETING TO BE HELD ON MAY 7, 2020

Our proxy statement and 2019 Annual Report are available at www.proxyvote.com or on our website investor.deepwater.com under “Financial Reports ― Annual and Quarterly Reports.”

 

 

 

Transocean 2020    P-6    Proxy Statement

Table of Contents

 

PROXY STATEMENT

 

 

 

 

 

Picture 229862

 

Picture 229864

 

Picture 1

WHEN

 

WHERE

 

RECORD DATE

Thursday, May 7, 2020

6:30 p.m., Swiss time

 

Parkhotel Zug

Industriestrasse 14

6304 Zug, Switzerland

 

April 20, 2020

 

INFORMATION ABOUT THE MEETING AND VOTING

This proxy statement is furnished in connection with the solicitation of proxies by Transocean Ltd., on behalf of the Board of Directors, to be voted at our 2020 Annual General Meeting to be held on May 7, 2020 at 6:30 p.m., Swiss time, at the Parkhotel Zug at Industriestrasse 14, 6304 Zug, Switzerland. The Notice or proxy statement and form of proxy, as appropriate, are first being mailed to shareholders on or about March [ ], 2020.

RECORD DATE

Only shareholders of record on April 20, 2020, are entitled to notice of, to attend, and to vote or to grant proxies to vote at, the 2020 Annual General Meeting. No shareholder will be entered in Transocean Ltd.’s share register with voting rights between the close of business on April 20, 2020, and the opening of business on the day following the 2020 Annual General Meeting.

While no shareholder will be entered in Transocean Ltd.’s share register as a shareholder with voting rights between the close of business on April 20, 2020, and the opening of business on the day following the 2020 Annual General Meeting, share blocking and re‑registration are not requirements for any shares of Transocean Ltd. to be voted at the meeting, and all shares may be traded after the record date. Computershare, which maintains Transocean Ltd.’s share register, will continue to register transfers of Transocean Ltd. shares in the share register in its capacity as transfer agent during this period.

QUORUM

Our Articles of Association provide that the presence of shareholders, in person or by proxy, holding at least a majority of all the shares entitled to vote at the time the meeting proceeds to business constitutes a quorum for purposes of convening the 2020 Annual General Meeting and voting on all of the matters described in the notice of meeting, except for the matter in Agenda 5, for which our Articles of Association require the presence of shareholders, in person or by proxy, holding at least two-thirds of the share capital recorded in the Commercial Register to constitute a quorum for purposes of action upon that matter. Abstentions and “broker non‑votes” will be counted as present for purposes of determining whether the relevant quorums at the meeting are satisfied, so long as the broker has discretion to vote the shares on at least one matter before the 2020 Annual General Meeting.

Transocean 2020    P-7    Proxy Statement

Table of Contents

 

VOTES REQUIRED

The following table sets forth the applicable vote standard required to pass each enumerated agenda item:

AGENDA
ITEM

    

DESCRIPTION

    

RELATIVE
MAJORITY(1)

TWO-THIRDS MAJORITY

PLURALITY OF
VOTES

1

 

Approval of the 2019 Annual Report, Including the Audited Consolidated Financial Statements and Audited Statutory Financial Statements for Fiscal Year 2019 of Transocean Ltd.

 

 

 

 

2

 

Discharge of the Members of the Board of Directors and Executive Management Team from Liability for Activities During Fiscal Year 2019

 

 

(2)

 

 

3

 

Appropriation of the Accumulated Loss

 

 

 

 

4

 

Increase in Total Number of Shares Authorized for Issuance

 

 

(3)

 

 

5

 

Increase of the Maximum Number of Members of the Board of Directors to 12 from 11

 

 

(4)

 

 

6

 

Election of 12 Directors

 

 

 

 

(5)(6)

7

 

Election of Chair of the Board of Directors

 

 

 

 

(5)

8

 

Election of Members of the Compensation Committee

 

 

 

 

(5)

9

 

Reelection of Independent Proxy

 

 

 

 

10

 

Appointment of Ernst & Young as Independent Auditor

 

 

 

 

11

 

Advisory Vote to Approve Named Executive Officer Compensation

 

 

(7)

 

 

12

 

Prospective Votes on the Maximum Compensation of the Board of Directors and the Executive Management Team

 

 

 

 

13

 

Approval of Amendment and Restatement of the Transocean Ltd. 2015 Long-Term Incentive Plan

 

 

 

 

 

(1)    Affirmative vote of a simple majority of the votes cast in person or by proxy at the 2020 Annual General Meeting on the applicable agenda item. Abstentions, broker non‑votes (if any) or blank or invalid ballots are not counted for such purposes and shall have no impact on the approval of such agenda item.

(2)    Affirmative vote of a simple majority of the votes cast in person or by proxy at the 2020 Annual General Meeting on the applicable agenda item. Shares held by members of the Board of Directors and members of the Company’s Executive Management Team are not entitled to vote on this matter and are not counted for this agenda item. Abstentions, broker non-votes (if any) or blank or invalid ballots are not counted for such purposes and shall have no impact on the approval of such agenda item.

(3)    The affirmative vote of at least two-thirds of the shares represented at the 2020 Annual General Meeting and entitled to vote on that agenda item. An abstention, blank or invalid ballot will have the effect of a vote “AGAINST” this proposal.

(4)    The affirmative vote of at least two-thirds of the shares entitled to vote on this agenda item at the 2020 Annual General Meeting. An abstention, blank or invalid ballot will have the effect of a vote “AGAINST” this proposal.

(5)    Affirmative vote of a plurality of the votes cast in person or by proxy at the 2020 Annual General Meeting. The plurality requirement means that the nominee who receives the largest number of votes for a position as a director, or the Chair or a position on the Compensation Committee, as applicable, is elected to that position. Only votes “FOR” are counted in determining whether a plurality has been cast in favor of a nominee. Abstentions, broker non‑votes, blank or invalid ballots are not counted for such purposes and

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shall have no impact on the election of such nominees. As described later in this proxy statement, our Corporate Governance Guidelines set forth our procedures if a nominee for director is elected but does not receive more votes cast “FOR” than “AGAINST” the nominee’s election.

(6)    Even if a nominee receives a plurality of votes that nominee may not ultimately serve as a director if the nominee does not receive more votes cast “FOR” than “AGAINST” the nominee’s election, and the Company’s Board of Directors accepts the resignation of the nominee pursuant to the Company’s majority vote policy, as described later in this proxy statement.

(7)    The proposal is an advisory vote; as such, the vote is not binding on the Company.

OUTSTANDING SHARES

As of February 27, 2020, there were 612,576,932 Transocean Ltd. shares outstanding, which exclude 5,393,593 that are held by the Company or our subsidiaries. Only registered holders of our shares on April 20, 2020, the record date established for the 2020 Annual General Meeting, are entitled to notice of, to attend and to vote at, the meeting. Holders of shares on the record date are entitled to one vote for each share held.

VOTING PROCEDURES

A copy of the Notice of Internet Availability of Proxy Materials is being sent to each shareholder registered in Transocean Ltd.’s share register as of the close of business on March [ ], 2020. Any additional shareholders who are registered in Transocean Ltd.’s share register as of the close of business on April 20, 2020, but who were not registered in the share register as of March 2, 2020, will receive a copy of the proxy materials, including a proxy card, after April 20, 2020. Shareholders not registered in Transocean Ltd.’s share register as of April 20, 2020, will not be entitled to attend, vote or grant proxies to vote at, the 2020 Annual General Meeting.

If you are registered as a shareholder in Transocean Ltd.’s share register as of April 20, 2020, or if you hold shares of Transocean Ltd. in “street name” as of such date, you may grant a proxy to vote on each of the proposals and any modification to any of the proposals or other matter on which voting is permissible under Swiss law and which is properly presented at the meeting for consideration in one of the following ways:

 

 

 

Picture 229873

BY INTERNET

 

 

Go to www.proxyvote.com 24 hours a day, seven days a week, and follow the instructions. You will need the 12‑digit control number that is included in the Notice, proxy card or voting instructions form that is sent to you. The internet system allows you to confirm that the system has properly recorded your voting instructions. This method of submitting voting instructions will be available up until 11:59 p.m. Eastern Daylight Time on Wednesday, May 6, 2020 (5:59 a.m. Swiss time on Thursday, May 7, 2020) unless extended by the Company.

 

 

Picture 229875

BY TELEPHONE

 

 

On a touch‑tone telephone, call toll‑free +1 (800) 690‑6903, 24 hours a day, seven days a week, and follow the instructions. You will need the 12‑digit control number that is included in the Notice, proxy card or voting instructions form that is sent to you. As with the internet system, you will be able to confirm that the telephonic system has properly recorded your votes. This method of submitting voting instructions will be available up until 11:59 p.m. Eastern Daylight Time on Wednesday, May 6, 2020 (5:59 a.m. Swiss time on Thursday, May 7, 2020) unless extended by the Company. If you are a holder of record, you cannot vote by telephone.

 

 

Picture 231186

BY MAIL

 

 

Mark, date and sign your proxy card exactly as your name appears on the card and return it by mail to:

 

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Picture 231185

Transocean 2020 AGM

Vote Processing

 

Picture 231187

Transocean 2020 AGM

Vote Processing

c/o Broadridge

 

Schweiger Advokatur / Notariat

51 Mercedes Way

or

Dammstrasse 19

Edgewood, NY 11717

 

6300 Zug

USA

 

Switzerland

 

 

 

 

 

All proxy cards must be received no later than 11:59 p.m. Eastern Daylight Time on Wednesday, May 6, 2020 (5:59 a.m. Swiss time on Thursday, May 7, 2020) unless extended by the Company. Do not mail the proxy card or voting instruction form if you are submitting voting instructions over the internet or by telephone.

 

 

 

YOUR VOTE IS IMPORTANT.

Even if you plan to attend the 2020 Annual General Meeting, we encourage you to submit your voting instructions over the internet or by mail prior to the meeting.

 

If you hold your shares in the name of a bank, broker or other nominee, you should follow the instructions provided by your bank, broker or nominee for voting your shares, including whether you may submit voting instructions by mail, telephone or over the internet.

Many of our shareholders hold their shares in more than one account and may receive more than one Notice. To ensure that all of your shares are represented at the 2020 Annual General Meeting, please submit your voting instructions for each account.

Under New York Stock Exchange (“NYSE”) rules, brokers who hold shares in street name for customers, such that the shares are registered on the books of the Company as being held by the brokers, have the authority to vote on “routine” proposals when they have not received instructions from beneficial owners, but are precluded from exercising their voting discretion with respect to proposals for “non‑routine” matters. Proxies submitted by brokers without instructions from customers for these non‑routine or contested matters are referred to as “broker non‑votes.” The following matters are non‑routine matters under NYSE rules:

 

 

 

AGENDA ITEM

 

DESCRIPTION

2

 

Discharge of the Members of the Board of Directors and the Executive Management Team from Liability for Activities During Fiscal Year 2019

6

 

Election of 12 Directors

7

 

Election of the Chair of the Board of Directors

8

 

Election of the Members of the Compensation Committee

11

 

Advisory Vote to Approve Named Executive Officer Compensation

12A

 

Ratification of the Maximum Aggregate Compensation of the Board of Directors for the Period Between the 2020 Annual General Meeting and the 2021 Annual General Meeting

12B

 

Ratification of the Maximum Aggregate Compensation of the Executive Management Team for Fiscal Year 2021

13

 

Approval of Amendment and Restatement of the Transocean Ltd. 2015 Long-Term Incentive Plan

 

If you hold your shares in “street name,” your broker will not be able to vote your shares on the agenda items set forth above and may not be able to vote your shares on other matters at the 2020 Annual General Meeting unless the broker receives appropriate instructions from you. We recommend that you contact your broker to exercise your right to vote your shares.

If you have timely submitted electronic or telephonic voting instructions or a properly executed proxy card, your shares will be voted by the independent proxy according to your instructions. Holders of shares who have timely

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submitted their proxy but have not specifically indicated how to vote their shares will be deemed to have instructed the independent proxy to vote in accordance with the recommendations of the Board of Directors with regard to the items listed in the notice of meeting.

If any modifications to agenda items or proposals identified in this invitation or other matters on which voting is permissible under Swiss law are properly presented at the 2020 Annual General Meeting for consideration, you will be deemed to have instructed the independent proxy, in the absence of other specific instructions, to vote in accordance with the recommendations of the Board of Directors.

As of the date of this proxy statement, the Board of Directors is not aware of any such modifications or other matters to come before the 2020 Annual General Meeting.

You may revoke your proxy card at any time prior to its exercise by taking one of the following actions:

   submitting a properly completed and executed proxy card with a later date and timely delivering it either directly to the independent proxy or to Vote Processing, c/o Broadridge at the addresses indicated below

 

   giving written notice of the revocation prior to the meeting to:

 

 

 

 

 

 

 

 

Picture 231189

Transocean 2020 AGM

Vote Processing

 

Picture 231192

Transocean 2020 AGM

Vote Processing

c/o Broadridge

 

Schweiger Advokatur / Notariat

51 Mercedes Way

Or

Dammstrasse 19

Edgewood, NY 11717

 

6300 Zug

USA

 

Switzerland

 

 

 

 

   appearing at the meeting, notifying the independent proxy, with respect to proxies granted to the independent proxy, and voting in person.

Your presence without voting at the meeting will not automatically revoke your proxy, and any revocation during the meeting will not affect votes in relation to agenda items that have already been voted on. If you hold your shares in the name of a bank, broker or other nominee, you should follow the instructions provided by your bank, broker or nominee in revoking your previously granted proxy.

Shareholders may grant proxies to any third party. Such third party need not be a shareholder.

If you wish to attend and vote at the 2020 Annual General Meeting in person, you are required to present either the Notice or any proxy card that is sent to you, together with proof of identification, or, if you own shares held in the name of a bank, broker or other nominee, a legal proxy issued by your bank, broker or other nominee in your name, together with proof of identification. If you plan to attend the 2020 Annual General Meeting in person, we urge you to arrive at the meeting location no later than 5:30 p.m. Swiss time on Thursday, May 7, 2020. In order to determine attendance correctly, any shareholder leaving the 2020 Annual General Meeting early or temporarily will be requested to present such shareholder’s admission card upon exit.

References to “Transocean,” the “Company,” “we,” “us” or “our” include Transocean Ltd. together with its subsidiaries and predecessors, unless the context requires otherwise.

 

 

 

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AGENDA ITEM 1

Approval of the 2019 Annual Report, Including the Audited Consolidated Financial Statements of Transocean Ltd. for Fiscal Year 2019 and the Audited Statutory Financial Statements of Transocean Ltd. for Fiscal Year 2019

PROPOSAL OF THE BOARD OF DIRECTORS

 

The Board of Directors proposes that the 2019 Annual Report, including the audited consolidated financial statements of Transocean Ltd. for fiscal year 2019 and the audited statutory financial statements of Transocean Ltd. for fiscal year 2019, be approved.

 

EXPLANATION

The audited consolidated financial statements of Transocean Ltd. for fiscal year 2019 and the audited Swiss statutory financial statements of Transocean Ltd. for fiscal year 2019 are contained in the 2019 Annual Report, which, along with this proxy statement, are available at: www.deepwater.com by selecting Financial Reports, Annual and Quarterly Reports in the Investors section dropdown. In addition, these materials will be available for physical inspection at

 

 

Picture 231224

Transocean Ltd.’s registered office
Turmstrasse 30
6312 Steinhausen, Switzerland

 

The 2019 Annual Report also contains information on the Company’s business activities and the Company’s business and financial situation, and the reports of Ernst & Young Ltd, Zurich, the Company’s auditors pursuant to the Swiss Code of Obligations, on the Company’s consolidated financial statements for fiscal year 2019 and statutory financial statements for fiscal year 2019. In its reports, Ernst & Young Ltd recommended without qualification that the Company’s consolidated financial statements and statutory financial statements for the year ended December 31, 2019, be approved. Ernst & Young Ltd expresses its opinion that the “consolidated financial statements for the years ended December 31, 2019 and 2018, present fairly in all material respects the consolidated financial position of Transocean Ltd. and subsidiaries at December 31, 2019 and 2018, and the consolidated results of operations and cash flows for each of the three years in the period ended December 31, 2019, in accordance with accounting principles generally accepted in the United States and comply with Swiss law.” Ernst & Young Ltd further expresses its opinion and confirms that the statutory financial statements for fiscal year 2019 comply with Swiss law and the Articles of Association of the Company.

Under Swiss law, the annual report, the consolidated financial statements and Swiss statutory financial statements must be submitted to shareholders for approval at each annual general meeting.

If the shareholders do not approve this proposal, the Board of Directors may call an extraordinary general meeting of shareholders for reconsideration of this proposal by shareholders.

 

RECOMMENDATION

The Board of Directors recommends a vote FOR this Agenda Item 1.

 

 

 

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AGENDA ITEM 2

Discharge of the Members of the Board of Directors and the Executive Management Team from Liability for Activities During Fiscal Year 2019

PROPOSAL OF THE BOARD OF DIRECTORS

 

The Board of Directors proposes that the members of the Board of Directors and Messrs. Jeremy D. Thigpen, Mark L. Mey, and Keelan I. Adamson, who served as members of our Executive Management Team in 2019, be discharged from liability for activities during fiscal year 2019.

 

EXPLANATION

As is customary for Swiss corporations and in accordance with Article 698, subsection 2, item 5 of the Swiss Code of Obligations, shareholders are requested to discharge the members of the Board of Directors and our Executive Management Team from liability for their activities during the past fiscal year.

Discharge pursuant to the proposed resolution is only effective with respect to facts that have been disclosed to shareholders (including through any publicly available information, whether or not included in our filings with the SEC) and only binds shareholders who either voted in favor of the proposal or who subsequently acquired shares with knowledge that the shareholders have approved this proposal. In addition, shareholders who vote against this proposal, abstain from voting on this proposal, do not vote on this proposal, or acquire their shares without knowledge of the approval of this proposal, may bring, as a plaintiff, any claims in a shareholder derivative suit within six months after the approval of the proposal. After the expiration of the six‑month period, such shareholders will generally no longer have the right to bring, as a plaintiff, claims in shareholder derivative suits against members of the Board of Directors or Executive Management Team with respect to activities during fiscal year 2019.

 

RECOMMENDATION

The Board of Directors recommends a vote FOR this Agenda Item 2.

 

 

 

 

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AGENDA ITEM 3

Appropriation of the Accumulated Loss for Fiscal Year 2019

PROPOSAL OF THE BOARD OF DIRECTORS

 

The Board of Directors proposes that the accumulated loss of the Company be carried forward.

 

 

 

 

 

 

 

 

APPROPRIATION OF ACCUMULATED LOSS

    

 

IN CHF THOUSANDS

 

Balance brought forward from previous years

 

 

(5,896,213)

 

Net loss of the year

 

 

(1,378,613)

 

Total accumulated loss

 

 

(7,274,826)

 

 

 

 

 

 

APPROPRIATION OF ACCUMULATED LOSS

 

 

 

 

Balance to be carried forward on this account

 

 

(7,274,826)

 

EXPLANATION

Under Swiss law, the appropriation of available earnings or accumulated loss, as the case may be, as set forth in the Swiss statutory financial statements must be submitted to shareholders for approval at each annual general meeting. The accumulated loss subject to the vote of the Company’s shareholders at the 2020 Annual General Meeting is the accumulated loss of Transocean Ltd., on a standalone basis.

 

RECOMMENDATION

The Board of Directors recommends a vote FOR this Agenda Item 3.

 

 

 

 

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AGENDA ITEM 4

Increase in Total Number of Shares Authorized for Issuance

PROPOSAL OF THE BOARD OF DIRECTORS

 

The Board of Directors proposes to amend the Company’s Articles of Association to increase the total number of shares that may be issued using the Company’s authorized share capital to a maximum of 184,974,503 shares, representing approximately 30% of the Company’s issued shares as of February 27, 2020. Within this authorization, the maximum number of shares issuable without preemptive rights would be limited to 61,658,167 shares, representing approximately 10% of the Company’s issued shares as of February 27, 2020. This authorization to issue shares with or without preemptive rights would expire on May 7, 2022. The Board of Directors does not currently have plans to issue shares under the proposed authorization. The Board of Directors believes, however, that providing the flexibility to issue shares quickly is a strategic benefit for the Company and that the proposal would more closely align the Company’s authorized share capital with that of its peers, most of whom have received similar or higher authorizations from their respective shareholders.

 

The proposed amendments to the Articles of Association are included in Annex A.

 

EXPLANATION

As of February 27, 2020, the Company had 616,581,677 shares issued and recorded in the Commercial Register. We are currently authorized to issue an additional 21,703,889 shares using the authorized share capital that was approved by our shareholders at our 2018 Annual General Meeting. The current authorized share capital expires on May 18, 2020.

Although our shares are listed on the NYSE and held predominantly by U.S. investors, we are incorporated in Switzerland and subject to Swiss corporate law. Unlike companies incorporated in U.S. jurisdictions for whom authorized share capital does not expire, our ability to issue shares using authorized share capital expires every two years under Swiss law. We have therefore traditionally sought shareholder approval every two years for additional authority to issue shares without a specific purpose using authorized share capital.

The current proposal would permit us to issue up to 184,974,503 additional shares using authorized share capital, or approximately 30% of the Company’s issued shares as of February 27, 2020 until May 7, 2022. Within this authorization, the maximum number of shares issuable without preemptive rights would be limited to 61,658,167 shares, or approximately 10% of the Company’s issued shares as of February 27, 2020.

We do not currently have plans to issue shares pursuant to the proposed authorization. We believe, however, that it is advisable to maintain flexibility to be able to access capital markets at optimal times and market conditions, rather than being subject to the delays and costs associated with calling a special shareholders’ meeting. Further, we believe the number of shares proposed for authorization is appropriate in all respects. It will allow our authorized share capital to be more closely aligned with the authorizations received by most of our peers. Further, we believe it is compliant with the policies of certain proxy advisory firms, whose voting recommendations help inform the voting decisions of some of our largest shareholders. The proposed authorization is also lower than the maximum authorization permitted under Swiss law and our Articles of Association.  

 

If the proposed increase in the total number of authorized shares is approved, the Board of Directors would determine the time of the issuance, the issuance price, the manner in which the shares will be paid, the date from which the shares carry the right to dividends and, subject to provisions of our Articles of Association and the limitations on issuing shares without preemptive rights described above, the conditions for the exercise of the preemptive rights with respect to the issuance and the allotment of preemptive rights that are not exercised.

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AGENDA ITEM 4

 

 

Further authorization for the issuance of the shares by a vote of our shareholders will not be solicited prior to such issuance, subject to applicable laws and regulations, including the rules of the NYSE.

 

The Board of Directors may allow preemptive rights that are not exercised to expire, or it may place such rights or shares, the preemptive rights of which have not been exercised at market conditions, or use them otherwise in the Company’s interest. Further, under our Articles of Association, and subject to the limitations on issuing shares without preemptive rights described above, in connection with the issuance of shares using authorized share capital, the Board of Directors is authorized to limit or withdraw the preemptive rights of the existing shareholders in various circumstances, including for financing and acquisitions purposes.

To the extent that shares are issued in the future, the issuance may decrease the existing shareholders’ percentage of equity ownership and, depending on the price at which such shares are issued, could be dilutive to the existing shareholders up to the amount of the proposed authorization above. However, we have demonstrated our commitment to prudently manage the Company’s use of and access to capital during the recent market downturn and developing market recovery. Since the proposed authorization has an expiration date – May 7, 2022 – our shareholders will have the opportunity to review and vote upon additional requests for shareholder approval of our authorized share capital at regular intervals.

 

RECOMMENDATION

The Board of Directors recommends a vote FOR this Agenda Item 4.

 

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AGENDA ITEM 5

 

 

 

AGENDA ITEM 5

Increase of the Maximum Number of Members of the Board of Directors to 12 from 11 for a Limited Period of Time

PROPOSAL OF THE BOARD OF DIRECTORS

 

The Board of Directors proposes that the maximum number of members of the Board of Directors under the Articles of Association be increased to 12 from 11 until the earlier of (i) the 2023 Annual General Meeting, or (ii) the resignation, removal or other departure, including not standing for re-election, of a member of our Board of Directors.

 

EXPLANATION

Robust corporate governance remains a priority of the Board of Directors. The Board of Directors periodically reviews the skills, experience and diversity of its members and the size of the Board to determine whether any changes are appropriate. Pursuant to our Corporate Governance Guidelines, we expect that two of our current directors will be subject to mandatory retirement from the Board of Directors in the next four years (one prior to the 2023 Annual General Meeting, and another prior to the 2024 Annual General Meeting.) The Board of Directors believes that the optimal size of the Board could range between 11 and 12 members, depending upon the experience and composition of its membership. Increasing the maximum number of members of the Board of Directors to 12 directors for a limited period of time will allow us to enhance the skills, experience and diversity among our directors, allow the Board of Directors to maintain committees of an appropriate size and composition, and provide for an orderly transition for the anticipated retirements. Assuming this proposal is approved by our shareholders and that all of the nominees proposed by the Board of Directors are elected, our Board of Directors will have 12 members until returning to a maximum of 11 members upon the earlier of the 2023 Annual General Meeting or the resignation, removal or other departure, including not standing for re-election, of a member of our Board of Directors elected at this 2020 Annual General Meeting.

The Board of Directors is proposing to amend Article 38 of the Company’s Articles of Association, accordingly, and increase the maximum number of directors to 12 for a limited period of time. If approved by our shareholders, the amendment of Article 38 becomes effective immediately.

 

RECOMMENDATION

The Board of Directors recommends a vote FOR this Agenda Item 5.

 

 

 

 

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AGENDA ITEM 6

Election of 12 Directors, Each for a Term Extending Until Completion of the Next Annual General Meeting

NOMINATIONS OF THE BOARD OF DIRECTORS

 

The Board of Directors has nominated the following candidates for election to the Board of Directors of the Company, each for a term extending until completion of the next annual general meeting.

 

 

 

 

 

Glyn A. Barker

 

 

Samuel J. Merksamer

Vanessa C.L. Chang

 

 

Frederik W. Mohn

Frederico F. Curado

 

 

Edward R. Muller

Chadwick C. Deaton

 

 

Diane de Saint Victor

Peter A. Goode(1)

 

 

Tan Ek Kia

Vincent J. Intrieri

 

 

Jeremy D. Thigpen

(1)

The election of Mr. Goode is subject to the approval of our shareholders of Agenda Item 5, which proposes an increase in the maximum number of members of the Board of Directors to 12 from 11 for a limited period of time.

Director Nomination Process

The Board of Directors has designated the Corporate Governance Committee as the committee authorized to consider and recommend nominees for the Board of Directors. The Board of Directors believes that all members of the Corporate Governance Committee meet the applicable NYSE independence requirements.

Our Corporate Governance Guidelines provide that the Corporate Governance Committee should periodically assess the needs of the Company and the Board of Directors, so as to recommend candidates who will further our goals. In making that assessment, the Corporate Governance Committee has determined that a recommended nominee must have the following minimum qualifications:

   High professional and personal ethics and values

   A record of professional accomplishment in his/her chosen field

   Relevant expertise and experience

   A reputation, both personal and professional, consistent with our FIRST Shared Values

In addition to these minimum qualifications, the Corporate Governance Committee considers other qualities in nominees that may be desirable. In particular, the Board of Directors is committed to having a majority of independent directors and, accordingly, the Corporate Governance Committee evaluates the independence status of any potential director. The Corporate Governance Committee evaluates whether or not a candidate contributes to the Board of Directors’ overall diversity, the candidate’s contribution to Board’s existing chemistry and collaborative culture, and whether or not the candidate can contribute positively to the Board’s diverse expertise in environmental, health, safety, industry, market and financial matters. The Corporate Governance Committee also considers whether or not the candidate may have professional or personal experiences and expertise relevant to our business (such as expertise in the industry and in critical health, safety and environmental matters) and the Company’s position as the leading international provider of offshore drilling services.

As described above, in accordance with the majority vote provisions of our Corporate Governance Guidelines, the Board of Directors may nominate only those candidates for director who have submitted an irrevocable letter of resignation, which would be effective upon and only in the event that (1) such nominee fails to receive more votes cast “FOR” than “AGAINST” his or her election in an uncontested election and (2) the Board of Directors accepts the resignation. The Board of Directors will also request a statement from any person

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AGENDA ITEM 6

 

nominated as a director by anyone other than the Board of Directors as to whether that person will also submit an irrevocable letter of resignation upon the same terms as a person nominated by the Board of Directors. For purposes of our Corporate Governance Guidelines, an uncontested election occurs in an election of directors that does not constitute a contested election, and a contested election occurs when (i) the Secretary of the Company receives a notice that a shareholder has nominated a person for election to the Board of Directors in compliance with the advance notice requirements for shareholder nominees for director set forth in our Articles of Association and (ii) such nomination has not been withdrawn by such shareholder on or prior to the day next preceding the date the Company first mails its notice of meeting for such meeting to the shareholders.

The Corporate Governance Committee has several methods of identifying Board of Directors candidates. First, the Corporate Governance Committee considers and evaluates annually whether each director nominee is qualified to be nominated for election or reelection to the Board of Directors. Second, the Corporate Governance Committee requests from time to time that its members and the other Board members identify possible candidates for any vacancies or potential vacancies. Third, the Corporate Governance Committee has the authority to retain one or more executive search firms to aid in its search for potential Board of Directors candidates, interview those candidates and conduct investigations relative to their background and qualifications.

The Corporate Governance Committee considers nominees for director who are recommended by our shareholders. Recommendations may be submitted in writing, along with:

   The name of and contact information for the candidate;

   A statement detailing the candidate’s qualifications and business and educational experience;

   Information regarding the qualifications and qualities described under “Director Nomination Process” above;

   A signed statement of the proposed candidate consenting to be named as a candidate and, if nominated and elected, to serve as a director;

   A signed irrevocable letter of resignation from the proposed candidate that, in accordance with our Corporate Governance Guidelines, would be effective upon and only in the event that (1) in an uncontested election, such candidate fails to receive more votes cast “FOR” than “AGAINST” his or her election and (2) the Board of Directors accepts the resignation;

   A statement that the writer is a shareholder and is proposing a candidate for consideration by the Corporate Governance Committee;

   A statement detailing any relationship between the candidate and any customer, supplier or competitor of ours;

   Financial and accounting experience of the candidate, to enable the Corporate Governance Committee to determine whether the candidate would be suitable for Audit Committee membership; and

   Detailed information about any relationship or understanding between the proposing shareholder and the candidate.

Shareholders may submit nominations to:

 

 

Picture 231228

Transocean Ltd.
Attention: Corporate Secretary
Turmstrasse 30
6312 Steinhausen, Switzerland

 

Unsolicited recommendations must contain all of the information that would be required in a proxy statement soliciting proxies for the election of the candidate as a director. The extent to which the Corporate Governance Committee dedicates time and resources to the consideration and evaluation of any potential nominee brought to its attention depends on the information available to the Corporate Governance Committee about the qualifications and suitability of the individual, viewed in light of the needs of the Board of Directors, and is at the

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AGENDA ITEM 6

 

 

Corporate Governance Committee’s discretion. The Corporate Governance Committee evaluates the desirability for incumbent directors to continue on the Board of Directors following the expiration of their respective terms, taking into account their contributions as Board members and the benefit that results from the increasing insight and experience developed over a period of time. Although the Corporate Governance Committee will consider candidates for director recommended by shareholders, it may determine not to recommend that the Board of Directors, and the Board of Directors may determine not to, nominate those candidates for election to the Board of Directors.

In addition to recommending director nominees to the Corporate Governance Committee, any shareholder may, in compliance with applicable requirements, nominate directors for election at annual general meetings of the shareholders. For more information on this topic, see “Other Matters.”

The Board of Directors considers diversity as a key factor in the director nominee selection process though it does not employ a strict policy. The Board of Directors takes an expansive view of the diversity of its members, with the goal of having directors who bring diverse expertise in environmental, health, safety, industry, market and financial matters and who reflect the global diversity of our workforce, our customers and the cultures in which we operate. We are a multinational company and will have nine different nationalities represented in our director and executive officer group, if Mr. Goode is elected, and over 58 in our global workforce. We have a presence in over 27 countries worldwide.

 

 

 

 

 

 

 

9

 

 

58+

 

 

27+

 

 

 

 

 

 

 

NATIONALITIES

 

 

NATIONALITIES

 

 

COUNTRIES WORLDWIDE

IN OUR DIRECTOR AND EXECUTIVE OFFICER GROUP

 

 

IN OUR GLOBAL WORKFORCE

 

 

 

 

Board Leadership

Except during extraordinary circumstances, the Board of Directors has chosen not to combine the positions of Chief Executive Officer and Chair of the Board. The Board believes that separating these positions allows our Chief Executive Officer to focus on our day‑to‑day business, while our Chair of the Board presides over the Board as it provides advice to, and independent oversight of, management and the Company’s operations. The Board recognizes the time, effort, and energy that our Chief Executive Officer is required to devote to his position and the additional commitment the position of Chair of the Board of Directors requires. The Board of Directors believes that having separate positions and having an independent outside director serve as Chair of the Board of Directors is the appropriate leadership structure for us at this time and demonstrates our commitment to good corporate governance.

Executive Sessions

Our independent directors met in executive session without management at each of the regularly scheduled Board of Directors’ meetings held in 2019. During 2020, the independent directors are again scheduled to meet in executive session at each regularly scheduled Board of Directors’ meeting. The independent directors generally designate the Chair of the Board of Directors to act as the presiding director for executive sessions.

Director Attendance at Annual General Meeting

We expect all of our directors to attend the 2020 Annual General Meeting. At the 2019 Annual General Meeting, all directors were in attendance

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AGENDA ITEM 6

 

VOTING REQUIREMENT TO ELECT NOMINEES

The election of each nominee requires the affirmative vote of a plurality of the votes cast in person or by proxy at the 2020 Annual General Meeting. The plurality requirement means that the nominee who receives the largest number of votes for a board seat is elected. Shareholders are entitled to one vote per share for each of the directors to be elected.

We have adopted a majority vote policy in the election of directors as part of our Corporate Governance Guidelines. This policy provides that the Board of Directors may nominate only those candidates for director who have submitted an irrevocable letter of resignation, which would be effective upon and only in the event that (1) such nominee fails to receive more votes cast “FOR” than “AGAINST” his or her election in an uncontested election and (2) the Board of Directors accepts the resignation. If a nominee who has submitted such a letter of resignation does not receive more votes cast for than against the nominee’s election, the Corporate Governance Committee must promptly review the letter of resignation and recommend to the Board of Directors whether to accept the tendered resignation or reject it. The Board of Directors must then act on the Corporate Governance Committee’s recommendation within 90 days following the certification of the shareholder vote. The Board of Directors must promptly disclose its decision regarding whether or not to accept the nominee’s resignation letter in a Form 8‑K furnished to the SEC or other broadly disseminated means of communication. Full details of this policy are set out in our Corporate Governance Guidelines, which are available on our website at: www.deepwater.com by selecting the Governance page in the Investors section dropdown.

The Board of Directors has received from each nominee for election as a director at the 2020 Annual General Meeting listed below an executed irrevocable letter of resignation consistent with these guidelines described above.

The information regarding the nominees presented below is as of February 27, 2020.

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NOMINEES FOR DIRECTOR

Picture 23

 

FORMER VICE CHAIR ― U.K.,

PWC LLP

 

U.K. CITIZEN

Independent

Age: 66

 

COMMITTEES

Audit

Finance

 

OTHER CURRENT PUBLIC COMPANY BOARDS

Berkeley Group Holdings plc (LON: BKG) (since 2012)

Interserve plc (LON: IRV) (since 2016)

 

GLYN A. BARKER  | Director since 2012

 

CAREER HIGHLIGHTS

Glyn A. Barker served as Vice Chair-U.K. of PricewaterhouseCoopers LLP (PwC) from 2008 to 2011. He was also responsible for PwC's strategy and business development for the geographic areas of Europe, the Middle East, Africa and India. Mr. Barker joined PwC in 1975 and became an audit partner in 1987. He then established PwC's private equity-focused Transactions Services business and led it globally. He joined the Management Board of PwC in the UK as Head of the Assurance Practice in 2002. In 2006, he became U.K. Managing Partner and served in that role until 2008. Mr. Barker is a director of Berkeley Group Holdings plc (LON: BKG) (since 2012), and Interserve plc (LON: IRV) (since 2016), and the Chair of Irwin Mitchell Holdings Ltd (since 2012). He served as director (from 2014 to 2016) and the Chair (from 2015 to 2016) of Transocean Partners LLC and as a director of Aviva plc (LON: AV) (from 2012 to 2019). Mr. Barker was Deputy Chair of the English National Opera Company from 2009 to 2016. 

 

EDUCATION

Chartered Accountant

Bachelor of Science, Economics and Accounting, University of Bristol (1975)

 

KEY QUALIFICATIONS AND EXPERTISE

The Board of Directors recommends Mr. Barker should remain on the Board of Directors due to his experience and expertise in:

Accounting  & auditing

Finance debt & capital markets

Global international

Mergers & acquisitions

Public company governance

Strategy

 

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AGENDA ITEM 6

 

 

Picture 24

 

FORMER DIRECTOR AND SHAREHOLDER OF EL & EL INVESTMENTS

 

CANADIAN AND U.S. CITIZEN

Independent

Age: 67

 

COMMITTEES

Audit

Corporate Governance

 

OTHER CURRENT PUBLIC COMPANY BOARDS

Edison International (NYSE: EIX since 2007)  

Sykes Enterprises, Incorporated (NASDAQ: SYKES) (since 2016)

 

VANESSA C.L. CHANG | Director since 2012

 

CAREER HIGHLIGHTS

Vanessa C.L. Chang previously served as a Director and shareholder of EL & EL Investments, a privately held real estate investment business, from 1998 to 2018, as the President and Chief Executive Officer of ResolveItNow.com from 2000 until 2002 and was the Senior Vice President of Secured Capital Corp in 1998. From 1986 until 1997, Ms. Chang was the West Coast partner in charge of Corporate Finance for KPMG Peat Marwick LLP. Ms. Chang is a director or trustee of 17 funds advised by the Capital Group and its subsidiaries, nine of which are members of the American Funds family and eight of which are members of Capital Group's Private Client Services (since 2000). Ms. Chang is also a director of Forest Lawn Memorial Parks Association, a non-profit organization (since 2005) and SCO, America, Inc. a non-profit organization (since 2013). She is a member of the American Institute of Certified Public Accountants, the California State Board of Accountancy,  Women Corporate Directors and the National Association of Corporate Directors.

 

EDUCATION

Certified Public Accountant (inactive)

Bachelor of Arts, University of British Columbia (1973)

 

KEY QUALIFICATIONS AND EXPERTISE

The Board of Directors recommends Ms. Chang should remain on the Board of Directors due to her experience and expertise in:

Accounting & auditing

Finance, debt & capital markets

Global international

Human capital management

Mergers & acquisitions

Public company governance

Strategy

Sustainability

 

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AGENDA ITEM 6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Picture 25

 

CEO, ULTRAPAR S.A.

 

BRAZILIAN CITIZEN

Independent
Age: 58

 

COMMITTEES

Corporate Governance

Health, Safety, Environment and Sustainability

 

OTHER CURRENT PUBLIC COMPANY BOARDS

ABB Ltd (NYSE: ABB) (since 2016)

 

FREDERICO F. CURADO | Director since 2013

 

CAREER HIGHLIGHTS

Frederico F. Curado is the Chief Executive Officer of Ultrapar S.A. (NYSE: UGP) since 2017, and previously served as President and Chief Executive Officer of Embraer S.A. (NYSE: ERJ) from 2007 to 2016. He joined Embraer in 1984 and served in a variety of management positions during his career, including Executive Vice President, Airline Market from 1998 to 2007 and Executive Vice President, Planning and Organizational Development from 1995 to 1998. Mr. Curado was a member of the Executive Board of the ICC―International Chamber of Commerce from 2013 to 2018, a director of Iochpe-Maxion S.A. from 2015 to 2017, the President of the Brazilian Chapter of the Brazil-United States Business Council from 2011 to 2016, a member of Brazil's National Council for Industrial Development from 2011 to 2016, and was a director of the Smithsonian National Air and Space Museum from 2014 to 2017.

 

EDUCATION

Executive Master’s in Business Administration, University of São Paulo, Brazil (in 1997)
Bachelor of Science degree, Mechanical-Aeronautical Engineering, Instituto Tecnológico de Aeronáutica in Brazil (1983)

 

KEY QUALIFICATIONS AND EXPERTISE

As noted above, in late 2019, we engaged with shareholders regarding among other things, the robust qualifications and capabilities of Mr. Curado.  The Board of Directors recommends that Mr. Curado remain on the Board due to the following:

   His leadership as the chair of our Health, Safety, Environment and Sustainability (HSES) Committee, informed by more than 30 years in the highly regulated aerospace industry, providing critical cross-industry perspectives on ways to continue to improve our HSES practices;

   His expertise in the oil and gas industry in Brazil, which is one of our key markets;

   His exemplary preparation for, attendance at, and engagement in, Board of Directors and committee meetings;

   His commitment to best practices in governance, executive compensation, shareholder engagement, and sustainability, as evidenced by our numerous improvements in those areas since he joined the Board of Directors; and

   His experience and expertise in:

Accounting & auditing

Finance, debt & capital markets

Global international, especially Brazilian business and governance sectors

Human capital management

Legal & compliance

Mergers & acquisitions

Oil & gas (including oilfield services)

Operations & engineering

Public company CEO

Public company governance

Safety & environment

Strategy

Sustainability

Technology, research & development

 

Lastly, we note that, although Mr. Curado is the Chief Executive Officer of Ultrapar S.A., he is not on the board of directors of that company; accordingly, he serves on only one Board of Directors other than our own.

 

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AGENDA ITEM 6

 

 

 

 

 

 

 

 

 

 

 

 

Picture 26

 

FORMER EXECUTIVE CHAIR AND CEO, BAKER HUGHES INCORPORATED

 

U.S. CITIZEN

Independent

Age 67

 

OTHER CURRENT PUBLIC COMPANY BOARDS

Air Products and Chemicals, Inc. (NYSE: APD) (since 2010)

CARBO Ceramics Inc. (NYSE: CRR) (since 2013; and previously from 2004 to 2009)

Marathon Oil Corporation (NYSE: MRO) (since 2014)

 

CHADWICK C. DEATON | Director since 2012

 

CAREER HIGHLIGHTS

Mr. Deaton served as Executive Chair of Baker Hughes Incorporated from 2012 to 2013, prior to which he served as Chair and Chief Executive Officer since 2004. He began his career with Schlumberger in 1976 and served in a variety of international capacities, including as Executive Vice President, Oilfield Services from 1998 to 1999 and as a Senior Advisor from 1999 until 2001. From 2002 until 2004, Mr. Deaton was the President, Chief Executive Officer and Director of Hanover Compressor Company. Mr. Deaton is a member of the Society of Petroleum Engineers (since 1980) and has served on its Industrial Advisory Council. He is also a director of the University of Wyoming Foundation and of the Houston Achievement Place. Mr. Deaton served as co-chair of the Wyoming Governor’s Task Force for the build out of the University of Wyoming’s new Engineering and Applied Sciences Center. He was a member of the National Petroleum Council (from 2007 to 2013).

 

EDUCATION

Bachelor of Science degree, Geology, University of Wyoming (1976)

 

KEY QUALIFICATIONS AND EXPERTISE

The Board of Directors recommends Mr. Deaton should remain on the Board of Directors due to his significant experience and expertise in:

Finance, debt & capital markets

Global international

Human capital management

Legal & compliance

Mergers & acquisitions

Oil & gas (including oilfield services)

Operations & engineering

Public company CEO

Public company governance

Safety & environment

Strategy

Technology, research & development

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AGENDA ITEM 6

 

 

 

 

 

 

 

 

Picture 229830

 

BOARD CHAIR, GR ENERGY SERVICES

 

AUSTRALIAN CITIZEN

Independent

Age 63

 

 

 

PETER A. GOODE | Director Nominee

 

CAREER HIGHLIGHTS

Mr. Goode is Chair of the Board and founder of GR Energy Services, a private oil and gas services company. He has more than 40 years of experience in the oilfield services industry and international experience at the Board level and in senior management. Mr. Goode also serves as a director on two other private company boards: Borets International (since 2016) and Electro Flow Controls (since 2019). Mr. Goode previously spent four years as an operating partner of Arle Capital from October 2012 to December 2016. Prior to that, he was the managing director and Chief Executive of Transfield Services, a role he took after co-founding and building Global Oilfield Services, which was sold to Halliburton in 2011. During his career, Mr. Goode has managed and advised private equity businesses on oil and gas investment, including Arle Capital, Candover Equity Partners and Pine Brook Road Partners. He was President and Chief Executive Officer at Vetco International Ltd., an international oilfield services company from 2004 to 2007. He spent 20 years at Schlumberger, where he worked his way from a research scientist to president, and also held various positions at Santos Ltd. in Australia from 1979 to 1995.

 

EDUCATION

Ph.D. Petroleum Engineering, Heriot-Watt University in Edinburgh, U.K.

Bachelor of Science degree in Applied Mathematics and Computing Science,  University of Adelaide

 

KEY QUALIFICATIONS AND EXPERTISE

The Board of Directors recommends Mr. Goode should be elected to the Board of Directors due to his significant experience and expertise in:

Global international

Legal & compliance

Mergers & acquisitions

Operations & engineering

Public company CEO

Public company governance

Safety & environment