Company: RIG
Filing Date: 2025-03-21
Form Type: PRE 14A
Source: 0001451505-25-000024
Chunk: 95

Company: Transocean Ltd.
Filing Date: 2025-03-21
Form: PRE 14A
Chunk 95
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 in our rig operations. We determined that uptime is the best measure of operational efficiency, which is an imperative for our customers and directly impacts their operational plan. Further, uptime has a direct correlation to the Company’s revenue.

Transocean 2025 P-99 Proxy Statement

|                                      | ​ |
| COMPENSATION DISCUSSION AND ANALYSIS | ​ |

Although uptime is a common operational metric in our industry, it has no standard industry definition or reporting structure. As a result, the Company has developed its own definition, in consultation with the Committee, and that definition recognizes the key impediments to Uptime: mechanical failures and human performance errors. Uptime is measured as total operating hours, minus downtime hours, expressed as a percentage of the total operating hours. Operating hours are defined as the number of hours a rig is operating under a contract. Downtime is generally defined as the number of hours the rig is not engaged in drilling activities, resulting from mechanical failure or human performance error.

| ​        | ​                                      | ​ |
| ​        | Total Operating Hours – Downtime Hours |   |
| Uptime = | __________________________________     |   |
| ​        | Total Operating Hours                  |   |

Using this formula, zero mechanical failures and human performance errors that do not result in a cessation of rig operations (i.e., downtime), would result in a rig operating at 100% Uptime. Downtime events detract from optimal performance and have a direct negative impact on the customer’s operational plan, as well as the Company’s financial goals. In setting the threshold-target-maximum range for this measure, the mathematical differential of 2% from threshold to maximum is significant considering the total number of operating hours during a calendar year (e.g., 189,575.5 hours of operation in 2024). The Committee approved the following uptime target for 2024:

| ​​                                  | ​ | ​ |              | ​ |
| UPTIME TARGET AND PERFORMANCE RANGE | ​ |   | BONUS PAYOUT 
 (%)          |   |
| Threshold = 96.0%                   | ​ | ​ | 0%           | ​ |
| Target = 97.0%                      | ​ | ​ | 100%         | ​ |
| Maximum = 98.0%                     | ​ | ​ | 200%         | ​ |

In setting the uptime target, the Committee considered the Company’s emerging 2024 outlook and the forecasted challenges related to possibly reactivating stacked assets and