Exhibit 10.2

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FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

 

THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (“Amendment”) is entered into by
and among Transocean Ltd., a Swiss corporation, Transocean Offshore Deepwater
Drilling Inc. (“TODDI”) and Transocean Management Ltd. (collectively, the
“Company”) and Gregory L. Cauthen (“Executive”), effective as of June 30, 2012.

 

WHEREAS, TODDI currently employs the Executive as its Executive Vice President
and Chief Financial Officer pursuant to that certain Employment Agreement
between the Company and Executive effective January 9, 2012 (the “Employment
Agreement”); and

 

WHEREAS, the Company and Executive wish to extend the Employment Term (as
defined therein) of the Employment Agreement and agree to additional
consideration in connection with such extension; and

 

WHEREAS, pursuant to Section 15 of the Employment Agreement, the Employment
Agreement may be amended or modified by an instrument in writing signed by the
parties thereto;

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and intending to be legally bound, the
Executive and the Company agree that the Employment Agreement is hereby amended,
effective as of June 30, 2012, as follows:

 

1.                                      Pursuant to Section 1(c) of the
Employment Agreement, the Company and the Executive hereby mutually agree to
extend the Employment Term to December 31, 2012.

 

2.                                      Section 3(b) of the Employment Agreement
is hereby amended in its entirety to read as follows:

 

“(b)         Bonus.  The Executive shall become entitled to a bonus payment (the
‘Bonus’) in an amount equal to 80 percent of Base Salary actually paid to the
Executive for services during the Employment Term (excluding payment for accrued
but unused vacation) contingent upon Executive’s full cooperation and assistance
during the Employment Term with the active search for a successor to the
Executive as Chief Financial Officer and the orderly transition of
responsibilities to such successor, as determined by the Compensation Committee
of the Board of Directors of Transocean (the ‘Committee’) in its discretion. 
The determination of the Committee shall be made in good faith, taking into
account a recommendation by the CEO with respect to the Executive’s satisfaction
of the criteria for the bonus payment.  Any such Bonus shall be paid in a single
lump-sum cash payment thirty days after the first meeting of the Committee
subsequent to the Executive’s termination of employment or, if earlier, on
March 15, 2013.  The Executive shall not be eligible to participate in the
Performance Award and Cash Bonus Plan or any other bonus plan maintained by the
Company or an affiliate.”

 

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3.                                      Provided that the Employment Term does
not terminate prior to July 1, 2012, Executive shall receive a grant of 30,002
deferred units under the Long-Term Incentive Plan of Transocean Ltd., with a
grant date of July 1, 2012, subject to earning and payment provisions in
substantially the form as attached hereto as Exhibit A.  For purposes of
clarity, the grant referenced in this Section 3 of this Amendment is in addition
to the grant of the “Deferred Unit Award” addressed in Section 3(c) of the
Employment Agreement.

 

4.                                          All other provisions of the
Employment Agreement shall remain the same and are hereby ratified.

 

IN WITNESS WHEREOF, each of the Companies have caused this Amendment to be
executed on its behalf by its duly authorized officer, and the Executive has
executed this Amendment, effective as of the date first set forth above.

 

 

 

TRANSOCEAN LTD.

 

 

 

 

 

 

By:

/s/ Steven L. Newman

 

 

Steven L. Newman

 

 

President & CEO

 

 

 

 

 

TRANSOCEAN DEEPWATER DRILLING INC.

 

 

 

 

 

 

By:

/s/ John L. Truschinger

 

 

John L. Truschinger

 

 

Senior Vice President, Support Services &

 

 

Chief Information Officer

 

 

 

 

 

TRANSOCEAN MANAGEMENT LTD.

 

 

 

 

 

 

By:

/s/ Ian Clark

 

 

Ian Clark

 

 

Vice President

 

 

 

 

 

EXECUTIVE

 

 

 

 

 

/s/ Gregory L. Cauthen

 

 

Gregory L. Cauthen

 

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EXHIBIT A

 

June 29, 2012

 

Mr. Gregory Cauthen

5409 Valerie Street

Bellaire, TX  77401

 

Dear Greg:

 

Transocean Ltd. (the “Company”) hereby grants to you effective as of
July 1, 2012 (the “Grant Date”), 30,002 deferred units (“Deferred Units”) in
accordance with the Amended and Restated Long-Term Incentive Plan of Transocean
Ltd. (the “Plan”).

 

This award is made in accordance with and is subject to the terms and conditions
set forth in the Plan, any additional terms and conditions set forth in the
attached Appendix A, the Prospectus for the Plan, and any rules and regulations
adopted by the Executive Compensation Committee of the Board of Directors.  A
copy of the Plan, Appendix A and the Prospectus are enclosed.

 

You do not need to pay any purchase price.  Your Deferred Units will be earned
and become payable as provided in Appendix A.

 

This award letter and the attachments contain the formal terms and conditions of
your award and should be retained in your files for future reference.

 

Congratulations on your award.

 

 

Sincerely,

 

 

 

 

 

Steven L. Newman

 

 

Enclosures

 

 

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Appendix A
to Award Letter
Granted July 1, 2012 (the “Grant Date”)

 

Terms and Conditions of
Deferred Unit Award

 

The deferred units (“Deferred Units”) granted to you on the Grant Date by
Transocean Ltd. (the “Company”) representing a specified number of registered
shares of the Company (“Shares”) are subject to the terms and conditions set
forth in the Long-Term Incentive Plan of Transocean Ltd. (the “Plan”), any
rules and regulations adopted by the Executive Compensation Committee of the
Board of Directors (the “Committee”), any additional terms and conditions set
forth in this Appendix A which forms a part of the award letter to you (“Award
Letter”) and the Prospectus for the Plan.  Any terms used in this Appendix A and
not defined in the Award Letter or this Appendix A have the meanings set forth
in the Plan.  The terms and provisions of your Deferred Units are governed by
the terms of the Plan as amended and restated February 12, 2009.  In the event
there is an inconsistency between the terms of the Plan and the Award Letter,
the terms of the Plan will control.

 

1.                                      Deferred Units and Determination of
Earned Deferred Units

 

(a)                                A number of the Deferred Units granted
pursuant to your Award Letter will be earned as described in paragraph
1(d) below on the earliest of (i) December 31, 2012, (ii) the date of your
termination of employment with the consent of Transocean or (iii) the date of
the termination of your employment due to death or disability (as determined by
the Committee, in its sole discretion) (the “Measurement Date”).  The Committee
shall have absolute discretion to determine the date and circumstances of
termination of your employment, and its determination shall be final, conclusive
and binding upon you.

 

(b)                                 The Committee may determine, at any time in
its discretion, that all or a portion of your Deferred Units will be earned in
advance of the Measurement Date specified in paragraph 1(a); provided, however,
that no such determination shall be made in a manner that is not in compliance
with any applicable requirements of Code Section 409A.  The date of any such
determination by the Committee will be the Measurement Date for purposes of this
Appendix A.

 

(c)                                  You do not need to pay any purchase price
for the Deferred Units unless otherwise required in accordance with applicable
law.

 

(d)                               The final number of Deferred Units that shall
become earned on the Measurement Date shall be calculated by multiplying the
number of Deferred Units referenced in your Award Letter by a fraction, the
numerator of which is the number of calendar days of employment during the
period beginning on July 1, 2012 and ending on December 31, 2012 and the
denominator of which is 184.  Any Deferred Units that are not earned as of the
Measurement Date shall be immediately forfeited.

 

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2.                                      Restrictions on the Deferred Units

 

(a)                                 Until and unless your Deferred Units are
earned pursuant to paragraph 1(b) or 1(d) (“Earned Deferred Units”) and you
receive a distribution of Shares, you may not attempt to sell, transfer, assign
or pledge them.  Until the date on which you receive a distribution of the
Shares in respect of any Earned Deferred Units awarded hereunder, your award of
Deferred Units will be evidenced by credit to a book entry account.

 

(b)                                 Your Earned Deferred Units will become
payable and settled in three equal installments payable, respectively, on
(i) July 1, 2013, (ii) July 1, 2014 and (iii) July 1, 2015.

 

(c)                                  When an installment of Deferred Units
becomes payable, the net Shares (total Shares distributable in respect of such
installment of Earned Deferred Units minus any Shares retained by the Company in
accordance with the policies and requirements described in this Appendix A),
will be delivered to you in street name to your Charles Schwab & Co. Inc.
(“Schwab”) brokerage account or Equity Award Center (or, in the event of your
death, to a Schwab brokerage account or Equity Award Center in the name of your
beneficiary under the Plan) or to such other brokerage account with another
broker retained by the Company if Schwab is no longer retained by the Company. 
Any Shares distributed to you in respect of earned Deferred Units will be
registered in your name and will not be subject to any restrictions.

 

3.                                      Dividends, Cash Consideration and Voting

 

(a)                                 Dividends

 

In the event that dividends are paid with respect to Shares, you will be
entitled to receive a cash payment equal to the amount of the dividend paid per
Share as of such dividend payment date multiplied by the number of Deferred
Units (including unearned Deferred Units and earned Deferred Units not yet
distributed to you) credited to your account immediately prior to such dividend
payment date (the “Dividend Equivalent”).  All Dividend Equivalents (if any)
payable with respect to your Deferred Units will be paid directly to you at the
same time dividends are paid with respect to all other Shares of the Company and
shall be subject to all applicable withholding taxes.  For any non-cash
dividends, the Committee may determine in its sole discretion the cash value to
be so paid to you in respect of such Deferred Units.

 

(b)                                 Cash Consideration

 

In the event that Shares are exchanged or reclassified by the Company resulting
in cash consideration paid for such Shares, you will be entitled to receive a
cash payment equal to the amount of cash consideration corresponding to the
number of Deferred Units (including unearned Deferred Units that would have
become Earned Deferred Units and Earned Deferred Units not yet distributed to
you) credited to your account at the same time such corresponding Deferred Units
would have become payable and subject to all applicable withholding taxes;

 

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provided, however, that such cash consideration shall not be paid at a time or
in a manner that is not in compliance with any applicable requirements of Code
Section 409A.

 

(c)                                  Voting Shares

 

You will have the right to vote your Shares that have been distributed in
respect of any Earned Deferred Units.  There are no voting rights associated
with Deferred Units.

 

(d)                                 No Other Rights

 

You shall have no other dividend equivalent, dividend or voting rights with
respect to any Deferred Unit.

 

4.                                      Beneficiary

 

You may designate a beneficiary to receive any portion of the Deferred Units
that become due to you after your death, and you may change your beneficiary
from time to time.  Beneficiary designations must be duly executed using the
proper form designated by the Human Resources Department and timely filed with
the administrator of the Plan in that department.  If you fail to designate a
beneficiary in that manner, any Deferred Units due to you under the Plan in the
event of your death will be paid to (1) in the event of your death prior to
termination of service, the beneficiary you designated under any group life
insurance plan maintained by the Company or its subsidiaries that provides the
largest death benefit, which will constitute the designated beneficiary for
purposes of Section 6.5 of the Plan, or, if not applicable, (2) the executor or
administrator of your estate.

 

5.                                      Income Tax Withholding

 

(a)                                 You should consult the Plan Prospectus for a
general summary of the U.S. federal income tax consequences to you and, if
applicable, the Swiss tax consequences to you, from the grant, earning and/or
distribution of Deferred Units based on currently applicable provisions of the
Code, related regulations and Swiss tax rules.  The summary does not discuss
state and local tax laws or the laws of any other jurisdictions, which may
differ from U.S. federal tax law and Swiss tax rules.  For these reasons, you
are urged to consult your own tax advisor regarding the application of the tax
laws to your particular situation.

 

(b)                                 The Company shall make such provisions as it
may deem appropriate for the withholding of any taxes which it determines is
required in connection with the Deferred Units and, unless otherwise approved by
the Company, the Company shall reduce the number of Shares otherwise deliverable
to you with respect to your Deferred Units by a number of Shares having a value
approximately equal to the amount required to be withheld under the Company’s
policies and procedures or applicable law.  The Company may, in its discretion,
permit you to make other arrangements satisfactory to the Company to satisfy any
applicable withholding tax liability arising from the earning of the Deferred
Units.  Further, any Dividend Equivalents paid to you in respect of Deferred
Units will be subject to tax withholding, as appropriate, as additional
compensation.

 

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(c)                                  In addition to the previous withholding
requirements, any award under the Plan is also subject to all applicable
withholding policies of the Company as may be in effect from time to time, at
the sole discretion of the Company.  Without limiting the generality of the
foregoing, the Company expressly has the right to withhold or cause to be
withheld (whether upon award determination, grant, time of earning, or
otherwise) any portion of an award (including without limitation any portion of
any securities issuable in connection with the Deferred Units) pursuant to any
tax equalization or other plan or policy, as any such policies or plans may be
in effect from time to time, irrespective of whether such withholding correlates
to the applicable tax withholding requirement with respect to your award. 
Awards are further subject to any tax and other reporting requirement that may
be applicable in any pertinent jurisdiction including any obligation to report
awards (whether related to the granting or earning thereof) to any taxing
authority or other pertinent third party.

 

6.                                      Restrictions on Resale

 

Other than the restrictions referenced in paragraph 2, there are no restrictions
imposed by the Plan on the resale of Shares acquired under the Plan.  However,
under the provisions of the U.S. Securities Act of 1933 (the “Securities Act”)
and the rules and regulations of the U.S. Securities and Exchange Commission
(the “SEC”), resales of Shares acquired under the Plan by certain officers and
directors of the Company who may be deemed to be “affiliates” of the Company
must be made pursuant to an appropriate effective registration statement filed
with the SEC, pursuant to the provisions of Rule 144 issued under the Securities
Act, or pursuant to another exemption from registration provided in the
Securities Act.  There are no restrictions imposed by the SEC on Shares acquired
under the Plan by persons who are not affiliates of the Company.

 

7.                                      Effect on Other Benefits

 

Income recognized by you as a result of the grant or earning of Deferred Units,
the payment of any Dividend Equivalents with respect to your Deferred Units or
the payment of any dividends with respect to your Shares acquired in accordance
with this Appendix A, will not be included in the formula for calculating
benefits under any of the Company’s retirement and disability plans or any other
benefit plans.

 

8.                                      Code Section 409A Compliance

 

To the extent applicable, this award of Deferred Units is intended to comply
with the provisions of Section 409A and, wherever possible, shall be interpreted
consistent therewith.  Specifically, the time of payment specified with respect
to paragraph 2(b) complies with Code Section 409A as being paid pursuant to a
specified time or fixed schedule under U.S. Treasury Regulation
Section 1.409A-3(i).  No action taken to comply with Code Section 409A shall be
deemed to impair a benefit under the Award Letter or this Appendix A.

 

Your Award Letter, Appendix A and related documents contain the formal terms and
conditions of your award.

 

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