EXHIBIT
10.41
TRANSOCEAN
LTD.
PENSION
EQUALIZATION PLAN
AS AMENDED AND
RESTATED
EFFECTIVE
JANUARY 1, 2009
TRANSOCEAN
LTD.
PENSION
EQUALIZATION PLAN
WHEREAS
,
GlobalSantaFe Corporate Services Inc. adopted and maintained the
GlobalSantaFe Pension Equalization Plan, as amended effective July
21, 2007 and as amended and restated effective November 27, 2007
(the “Prior GSF Plan”); and
WHEREAS
,
Transocean Inc. (“Transocean”) adopted and maintained
the Transocean U.S. Supplemental Retirement Plan, as amended and
restated effective November 27, 2007 (the “Prior TO
Plan”); and
WHEREAS
,
on November 27, 2007, GlobalSantaFe Corporation
(“GlobalSantaFe”) completed the transactions
contemplated by an Agreement and Plan of Merger with Transocean
Inc. and Transocean Worldwide Inc., a direct wholly owned
subsidiary of Transocean (“Transocean Worldwide”),
pursuant to which GlobalSantaFe merged with Transocean Worldwide by
way of a scheme of arrangement qualifying as an amalgamation under
Cayman Islands law, with Transocean Worldwide continuing as the
surviving entity; and
WHEREAS
,
effective January 1, 2009, the Prior GSF Plan and the Prior TO Plan
shall be amended and restated to merge and harmonize the two plans
in the form of the Transocean Ltd. Pension Equalization Plan (as
amended and restated effective January 1, 2009).
NOW
THEREFORE , the Plan is
hereby amended and restated to read as follows, effective as of
January 1, 2009:
ARTICLE
I
PURPOSE
1.1
Purpose of the Plan : The purpose of this Plan is generally
to provide the amount of the benefit that would otherwise be paid
under the Pension Plan, as in effect on the applicable date, but
which cannot be paid under these plans on account of (a) the
limitations of Section 401(a)(17) of the Internal Revenue Code of
1986, as amended (the “Code”), which limits the annual
compensation that may be taken into account in computing benefits
under the Pension Plan to $245,000 in 2009 (or such other annual
dollar amount as may be prescribed by the Secretary of the Treasury
or his or her delegate), and (b) Section 415 of the Code, which
limits the benefits and contributions under qualified
plans.
1.2
ERISA Status : Program A of the Plan, detailed in Article
III below, is intended to qualify for the exemptions provided under
Title I of the Employee Retirement Income Security Act of 1974, as
amended from time to time (“ERISA”), for plans that are
not qualified under Code Section 401(a) and that are maintained
primarily to provide deferred compensation for a select group of
management or highly compensated employees. Program B of the Plan,
set forth in Article IV below, is intended to qualify for the
exemptions provided under Title I of ERISA for plans that are
excess benefit plans as defined in Section 3(36) of
ERISA.
ARTICLE
II
DEFINITIONS
Except as
otherwise indicated, for purposes of the Plan, the terms listed
below shall be defined as follows:
Additional
Service Period : The term
“Additional Service Period” means, with respect to any
Participant who received a severance payment, whether in the form
of salary and/or bonus continuation payments or in a lump sum or
sums, the salary and/or bonus continuation period or, in the case
of a lump sum or sums, the period with respect to which the lump
sum or sums are deemed paid pursuant to the definitions of
“Basic Earnings” and “Bonus” contained in
this Plan.
Administrative
Committee : The committee
established by the Board to administer the Plan pursuant to Section
8.1.
Affiliate
:
The term “Affiliate” shall have the identical meaning
of that term as set out in the Pension Plan.
Applicable
Interest Rate : With respect
to (i) benefits accrued under this Plan on and after January 1,
2009, and (ii) benefits accrued prior to January 1, 2009 under the
Legacy GlobalSantaFe Plan, the “Applicable Interest
Rate” is the interest rate used in the Applicable Pension
Plan.
With respect
to (i) benefits accrued at any time for those certain Participants
listed on Appendix C hereto, and (ii) benefits accrued prior to
January 1, 2009 under the Legacy Transocean Plan, the
“Applicable Interest Rate” is the annual interest rate
equal to the yield on a new 7-12 year AA-rated general obligation
tax-exempt bond as determined by Merrill Lynch & Co. (or its
affiliates) and published in The Wall Street Journal. For purposes
of the preceding sentence, an annual interest rate is to be
determined as the average of the daily yields for November of the
Plan Year preceding the Plan Year in which occurs the proposed date
of payment; in such case, the stability period for such applicable
interest rate shall be the Plan Year.
Applicable
Pension Plan : The term
“Applicable Pension Plan” means the Pension Plan as in
effect on the date of Participant’s Termination of
Employment.
Basic
Earnings : The term
“Basic Earnings” shall have the identical meaning of
that term as set forth in the Pension Plan, only without regard to
the limitations imposed by Section 401(a)(17) of the Code; provided
that “Basic Earnings” shall include severance payments
based on a multiple or any percentage of salary, whether made as
salary continuation payments or in a lump sum or sums. In the event
such a severance payment is paid in a lump sum or sums, the salary
amount shall be deemed to accrue over the period of time it would
normally have been paid had the Participant’s salary at the
time of termination continued until the severance payments were
exhausted.
Board
:
The Board of Directors of the Company.
Bonus
:
The term “Bonus” shall have the identical meaning of
that term as set out in the Pension Plan, only without regard to
the limitations imposed by Section 401(a)(17) of the Code; provided
that the term “Bonus” shall include severance payments
based on a multiple or any percentage of a bonus or deemed bonus,
whether made as bonus continuation payments or in a lump sum or
sums. In the event such a severance payment is paid in a lump sum
or sums, the payment shall be included and shall be deemed paid as
follows: (a) any payment based on a multiple of a bonus or deemed
bonus shall be divided by the multiplier and each fraction thereof
shall constitute a single annual “Bonus,” which shall
be deemed paid on the customary annual bonus date (as determined by
the Administrative Committee) over the number of years represented
by the multiplier and (b) any payment that is 100% of, or less
than, the bonus or deemed bonus shall be deemed to be paid on the
customary bonus date next following the date of the
Participant’s termination of employment.
Code
:
The Internal Revenue Code of 1986, as amended from time to
time.
Company
:
Transocean Ltd.
Effective
Date : January 1,
2009.
ERISA
:
The Employee Retirement Income Security Act of 1974, as amended
from time to time.
Legacy
GlobalSantaFe Plan : The
GlobalSantaFe Pension Equalization Plan, as amended and restated
effective November 27, 2007, and as thereafter amended and in
effect on December 31, 2008. The Legacy GlobalSantaFe Plan is
attached hereto as Exhibit A, solely for purposes of calculating
the amount of a Participant’s Legacy Plan Benefit.
Legacy
Plan : The Legacy
GlobalSantaFe Plan and the Legacy Transocean Plan, as
applicable.
Legacy Plan
Benefit : The Legacy
Plan Benefit calculated pursuant to Article VI.
Legacy
Transocean Plan : The
Transocean U.S. Supplemental Retirement Benefit Plan, as amended
and restated effective November 27, 2007, and as thereafter amended
and in effect on December 31, 2008. The Legacy Transocean Plan is
attached hereto as Exhibit B, solely for purposes of calculating
the amount of a Participant’s Legacy Plan Benefit.
Lump-Sum
Equivalent : With respect
to any benefit hereunder, a lump-sum payment equal in value at date
of determination of such benefit when determined actuarially, based
upon the mortality table used in the Pension Plan in effect as of
Participant’s Termination of Employment and based upon the
Applicable Interest Rate In the event that age is increased by a
salary and/or bonus continuation period or an Additional Service
Period (“imputed years”), the lump sum payment will be
discounted by the number of imputed years from the date of
determination to the date of payment using interest only at the
Applicable Interest Rate. For purposes of Sections 3.3(f), 4.3(f)
and 5.1(c) herein, the date of determination is the day after the
end of the Additional Service Period.
Participant
:
An employee of the Company or its Affiliate who qualifies for
participation in the Plan under Sections 3.2 and/or 4.2 of the
Plan.
Pension
Plan : The
Transocean U.S. Retirement Plan, as amended and restated effective
January 1, 2009, and as thereafter may be amended from time to
time.
Plan
:
The Transocean Ltd. Pension Equalization Plan, as amended and
restated effective January 1, 2009 and as thereafter amended from
time to time.
Plan
Administrator : The
Administrative Committee.
Section
409A : Section 409A
of the Code and applicable U.S. Treasury authorities.
SERP
:
The Transocean Supplemental Executive Retirement Plan, as amended
and restated effective January 1, 2008 and thereafter amended from
time to time.
Termination of
Employment : The term
“Termination of Employment” means “separation
from service,” as defined in Section 1.409A-1(h) of the U.S.
Treasury regulations, with the Company or an Affiliate for any
reason other than a transfer between Employers.
Window Benefit
Participant : A Participant
who is eligible for a window benefit under the Applicable Pension
Plan.
Window
Excluded Participant : A Participant
who would have been eligible for a window benefit under the
Applicable Pension Plan had Participant not been specifically
excluded pursuant to Appendix A of the Applicable Pension
Plan.
ARTICLE
III
PROGRAM A:
RESTORATION OF BENEFITS REDUCED BY SECTION
401(a)(17)
3.1
Purpose : Section 401(a)(17) of the Code limits the amount
of compensation that may be taken into account under a qualified
plan for any year to $245,000 in 2009 (or such other annual dollar
amount as may be prescribed by the Secretary of the Treasury or his
or her delegate). The purpose of Program A is to restore to
Participants any benefits that would have been available to them
under the Pension Plan had the limitations of Section 401(a)(17) of
the Code not been imposed.
3.2
Participation : In order to participate in Program A of
this Plan, an individual must (a) have experienced a reduction
in the benefits he would have received from his Pension Plan as a
result of the Code Section 401(a)(17) limitations on the
amount of annual compensation that may be included in the
calculation of benefits and (b) be a member of a select group
of management or highly compensated employees (as those terms are
set forth in Section 201(2) of ERISA) who are identified by
the Plan Administrator.
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(a)
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The benefit payable under Program A
will be equal to (i) less (ii) below:
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(i)
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the monthly benefit for the
Participant calculated under the Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Section 401(a)(17) of the Code, as amended, or any
successor sections of the Code; less
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(ii)
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the monthly benefit calculated and
payable under the Pension Plan.
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(b) For
purposes of subsections (a)(i) and (ii), each Pension Plan benefit
shall be converted into a single life annuity commencing on the
later of the Participant’s normal retirement date under the
Pension Plan or the date benefits are paid under this
Plan.
(c) The
amount in subsection (a) will be subject to limits described in
Article V.
(d) Benefits
under this Article III will be paid only to supplement benefits
actually payable from the Pension Plan.
(e) The
amount in subsection (a)(i) shall include the Additional Service
Period. Furthermore, (to the extent not already included pursuant
to the provisions of the Pension Plan) the age of any such
Participant shall be deemed to include the years and partial years
contained in the Additional Service Period. It is intended that the
application of Section 3.3(e) shall extend to, but not be limited
to, Window Benefit Participants and Window Excluded
Participants.
(f) For
Window Benefit Participants, the benefit described in this Section
3.3 shall equal the Lump Sum Equivalent of the excess of (i) over
(ii) below:
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(i)
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the monthly benefit for the
Participant calculated under the Applicable Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Section 401(a)(17) of the Code, as amended, or any
successor sections of the Code and assuming that Participant
remained employed through the end of the Additional Service Period
and commenced his benefit at that time (or, if not eligible for
early retirement under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension Plan));
over
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(ii)
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the monthly benefit calculated and
payable under the Applicable Pension Plan assuming the Participant
remained employed through the end of the Additional Service Period
and commenced payment of his benefit at that time (or, if not
eligible to for early retirement under the Applicable Pension Plan
at the end of the Additional Service Period, assuming Participant
had commenced his benefit under the Applicable Pension Plan on his
Normal Retirement Date (as defined in the Applicable Pension
Plan)).
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For Window
Excluded Participants, the benefit described in this Section 3.3
shall equal the Lump Sum Equivalent of the excess of (iii) over
(iv) below:
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(iii)
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the monthly benefit for the
Participant calculated under the Applicable Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Section 401(a)(17) of the Code, as amended, or any
successor sections of the Code and assuming that Participant
remained employed through the end of the Additional Service Period
and commenced his benefit at that time (or, if not eligible for
early retirement under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension Plan));
over
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(iv)
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the monthly benefit calculated and
payable under the Applicable Pension Plan assuming Participant
terminated employment on the date of his actual Termination of
Employment and commenced payment of his benefit after the
expiration of the Additional Service Period (or, if not eligible to
commence payment under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the
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Applicable
Pension Plan on his Normal Retirement Date (as defined in the
Applicable Pension Plan)).
For purposes
of this Section 3.3(f), a Participant’s “Social
Security Covered Compensation” (as defined in the Applicable
Pension Plan) is projected to increase during the Additional
Service Period using an inflation assumption of 3%.
3.4
Applicability . This Article III shall only apply to
benefits accrued from and after January 1, 2009.
ARTICLE
IV
PROGRAM B:
RESTORATION OF BENEFITS REDUCED BY SECTION 415
4.1
Purpose : Section 415 of the Code limits the benefits and
contributions under qualified plans. The purpose of Program B is to
restore to Participants any benefits that would have been available
to them under the Pension Plan had the limitations of Section 415
of the Code not been imposed.
4.2
Participation : In order to participate in Program B of
this Plan, an individual must (a) have experienced a reduction
in the benefits he would have received from a Pension Plan as a
result of the Code Section 415 limitations and (b) be
selected for participation by the Plan Administrator.
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(a)
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The benefit payable under Program B
will be equal to (i) less (ii) below:
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(i)
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the monthly benefit for the
Participant calculated under the Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Section 415 of the Code, as amended, or any
successor sections of the Code; less
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(ii)
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the monthly benefit calculated and
payable under the Pension Plan.
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(b) For
purposes of subsections (a)(i) and (ii), each Pension Plan benefit
shall be converted into a single life annuity commencing on the
later of the Participant’s normal retirement date under the
Pension Plan or the date benefits are paid under this
Plan.
(c) The
amount in subsection (a) will be subject to limits described in
Article V.
(d) Benefits
under this Article IV will be paid only to supplement benefits
actually payable from the Pension Plan.
(e) The
amount in subsection (a)(i) shall include the Additional Service
Period. Furthermore, (to the extent not already included pursuant
to the provisions of the Pension Plan) the age of any such
Participant shall be deemed to include the years and partial years
contained in the Additional Service Period. It is intended that the
application of Section 4.3(e) shall extend to, but not be limited
to, Window Benefit Participants and Window Excluded
Participants.
(f) For
Window Benefit Participants, the benefit described in this Section
4.3 shall equal the Lump Sum Equivalent of the excess of (i) over
(ii) below:
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(i)
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the monthly benefit for the
Participant calculated under the Applicable Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Section 415 of the Code, as amended, or any
successor sections of the Code and assuming that Participant
remained employed through the end of the Additional Service Period
and commenced his benefit at that time (or, if not eligible for
early retirement under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension Plan));
over
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(ii)
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the monthly benefit calculated and
payable under the Applicable Pension Plan assuming Participant
remained employed through the end of the Additional Service Period
and commenced payment of his benefit at that time (or, if not
eligible for early retirement under the Applicable Pension Plan at
the end of the Additional Service Period, assuming Participant had
commenced his benefit under the Applicable Pension Plan on his
Normal Retirement Date (as defined in the Applicable Pension
Plan)).
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For Window
Excluded Participants, the benefit described in this Section 4.3
shall equal the Lump Sum Equivalent of the excess of (iii) over
(iv) below:
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(iii)
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the monthly benefit for the
Participant calculated under the Applicable Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Section 415 of the Code, as amended, or any
successor sections of the Code and assuming that Participant
remained employed through the end of the Additional Service Period
and commenced his benefit at that time (or, if not eligible for
early retirement under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension Plan));
over
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(iv)
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the monthly benefit calculated and
payable under the Applicable Pension Plan assuming Participant
terminated employment on the date of his actual Termination of
Employment and commenced payment of his benefit after the
expiration of the Additional Service Period (or, if not eligible to
commence payment under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension
Plan)).
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For purposes
of this Section 4.3(f), a Participant’s “Social
Security Covered Compensation” (as defined in the Applicable
Pension Plan) is projected to increase during the Additional
Service Period using an inflation assumption of 3%.
4.4
Applicability . This Article IV shall only apply to benefits
accrued from and after January 1, 2009.
ARTICLE
V
MAXIMUM
BENEFIT
5.1 In
the event that a Participant is eligible for both Program A and
Program B, the aggregate benefit shall not exceed an amount equal
to (a) less (b) below:
(a) the
monthly benefit for the Participant calculated under the Pension
Plan using the Participant’s Basic Earnings and Bonus without
regard to the limitations of Sections 401(a)(17) and 415 of the
Code, as amended, or any successor sections of the Code;
less
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(b)
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the monthly benefit calculated and
payable under the Pension Plan.
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For purposes
of subsections (a) and (b), each Pension Plan benefit shall be
converted into a single life annuity commencing on the later of the
Participant’s normal retirement date under the Pension Plan
or the date benefits are paid under this Plan.
The amount in
subsection (a) shall include (to the extent not already included
pursuant to the provisions of the Pension Plan) the Additional
Service Period. Furthermore, (to the extent not already included
pursuant to the provisions of the Pension Plan) the age of any such
Participant shall be deemed to include the years and partial years
contained in the Additional Service Period. It is intended that the
application of Section 5.1 shall extend to, but not be limited to,
Window Benefit Participants and Window Excluded
Participants..
(c) For
Window Benefit Participants, the aggregate benefit described in
this Section 5.1 shall not exceed the Lump Sum Equivalent of the
excess of (i) over (ii) below:
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(i)
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the monthly benefit for the
Participant calculated under the Applicable Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Sections 401(a)(17) and 415 of the Code, as amended,
or any successor sections of the Code and assuming that Participant
remained employed through the end of the Additional Service Period
and commenced his benefit at that time (or, if not eligible for
early retirement under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension Plan));
over
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(ii)
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the monthly benefit calculated and
payable under the Applicable Pension Plan assuming Participant
remained employed through the end of the Additional Service Period
and commenced payment of his benefit at that time (or, if not
eligible for early retirement under the Applicable Pension Plan at
the end of the Additional Service
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Period,
assuming Participant had commenced his benefit under the Applicable
Pension Plan on his Normal Retirement Date (as defined in the
Applicable Pension Plan)).
For Window
Excluded Participants, the aggregate benefit described in this
Section 5.1 shall not exceed the Lump Sum Equivalent of the excess
of (iii) over (iv) below:
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(iii)
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the monthly benefit for the
Participant calculated under the Applicable Pension Plan using the
Participant’s Basic Earnings and Bonus without regard to the
limitations of Sections 401(a)(17) and 415 of the Code, as amended,
or any successor sections of the Code and assuming that Participant
remained employed through the end of the Additional Service Period
and commenced his benefit at that time (or, if not eligible for
early retirement under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension Plan));
over
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(iv)
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the monthly benefit calculated and
payable under the Applicable Pension Plan assuming Participant
terminated employment on the date of his actual Termination of
Employment and commenced payment of his benefit after the
expiration of the Additional Service Period (or, if not eligible to
commence payment under the Applicable Pension Plan at the end of
the Additional Service Period, assuming Participant had commenced
his benefit under the Applicable Pension Plan on his Normal
Retirement Date (as defined in the Applicable Pension
Plan)).
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For purposes
of this Section 5.1(c), a Participant’s “Social
Security Covered Compensation” (as defined in the Applicable
Pension Plan) is projected to increase during the Additional
Service Period using an inflation assumption of 3%.
5.2
Applicability . This Article V shall only apply to benefits
accrued from and after January 1, 2009.
ARTICLE
VI
LEGACY PLAN
BENEFIT
6.1 A
Participant who was eligible to participate in a Legacy Plan shall
be entitled to a Legacy Plan Benefit, calculated pursuant to the
terms in effect on the earlier of (i) December 31, 2008 or (ii) the
Participant’s latest date of participation therein, in
addition to the Plan benefit described herein if otherwise
eligible. For purposes of computing a Participant’s Legacy
Plan Benefit pursuant to this Article VI, a Participant’s
service shall be limited solely to service accrued under the Legacy
Plan, but compensation shall also include compensation earned while
the Participant is participating in the Plan if doing so would
result in a greater Legacy Plan Benefit.
6.2
Applicability . This Article VI shall only apply to benefits
accrued before January 1, 2009.
ARTICLE
VII
VESTING AND
BENEFIT PAYMENT
7.1
Form and Timing of Payment : The monthly benefit determined
to be payable under this Plan shall be converted to a Lump-Sum
Equivalent benefit. Subject to Section 8.17, the lump sum amount
determined shall be payable to the Participant or surviving spouse
within 90 days following Participant’s Termination of
Employment from the Company and its Affiliates.
7.2
Vesting : A Participant shall become vested in the benefit
payable under this Plan at the same time that he becomes vested
under the Pension Plan.
7.3
Effect of an Agreement : Benefits under the Plan may be
increased, decreased or otherwise modified by any legally binding
contractual agreement between a Participant and the
Company.
7.4
SERP Offset Calculation : The monthly benefit calculated for
purposes of determining the amount payable under this Plan shall
offset the benefit, if any, payable under the SERP. Pursuant to
subsection (d) of the SERP’s definition of “Normal
Retirement Benefit,” the benefit payable under this Plan
shall, for purposes of the offset, be converted into a single life
annuity commencing on the later of the Participant’s normal
retirement date under the Pension Plan or the date benefits are
paid under this Plan.
ARTICLE
VIII
MISCELLANEOUS
8.1
Administration and Interpretation : The Plan shall be
administered by the Administrative Committee. The determination of
the Administrative Committee as to any disputed questions arising
under this Plan, including questions of construction and
interpretation, shall be final, binding and conclusive upon all
persons. Benefits under this Plan will be paid only if the Plan
Administrator decides in its discretion that the claimant is
entitled to them.
8.2
Expenses : The expenses of administering the Plan shall be
borne by the Company.
8.3
Indemnification and Exculpation : The members of the
Administrative Committee, its agents, and officers, directors and
employees of the Company and its Affiliates shall be indemnified
and held harmless by the Company against and from any and all loss,
cost, liability or expense that may be imposed upon or reasonably
incurred by them in connection with or resulting from any claim,
action, suit or proceeding to which they may be a party or in which
they may be involved by reason of any action taken or failure to
act under this Plan and against and from any and all amounts paid
by them in settlement (with the Company’s written approval)
or paid by them in satisfaction of a judgment in any such action,
suit or proceeding. The foregoing provision shall not be applicable
to any person if the loss, cost, liability or expense is due to
such person’s gross negligence or willful
misconduct.
8.4
Amendment : The Plan may be amended, in whole or in part, by
action of the Board, in its sole discretion. Benefits under the
Plan may be increased, decreased or otherwise modified by any
legally binding contractual agreement between a Participant and the
Company.
8.5
Termination : The Board may, at its sole discretion,
terminate, suspend or amend the Plan at any time or from time to
time, in whole or in part in accordance with Section
1.409A-3(j)(4)(ix) of the U.S. Treasury regulations.
8.6
Not an Employment Agreement : Nothing contained in this Plan
is intended to nor shall it confer upon any Participant the right
to be retained in the service of the Company and its Affiliates,
nor shall the existence of this Plan interfere with the right of
the Company and its Affiliates to terminate, lay off, discharge or
otherwise deal with any Participant.
8.7
Funding : All payments under this Plan shall be made from
the general assets of the Participant’s employer during the
period the Participant accrued benefits under this Plan. In the
event that a Participant changed employers during the period of
benefit accrual under this Plan, each employer shall fund the
Participants’ payment under this Plan to the extent that the
payment reflects benefits accrued during the Participant’s
tenure with such employer. Each Participant remains a general,
unsecured creditor of the employer responsible for funding the
Participant’s payments under this Plan with respect to
benefits accrued or paid under this Plan.
8.8
Severability : In the event any provision of the Plan shall
be held illegal or invalid for any reason, any illegality or
invalidity shall not affect the remaining parts of the Plan, but
the Plan shall be construed and enforced as if the illegal or
invalid provision had never been inserted,
and
the Company shall have the privilege and opportunity to correct and
remedy such questions of illegality or invalidity by amendment as
provided in the Plan.
8.9
Assignment of Benefits : A Participant may not, either
voluntarily or involuntarily, assign, anticipate, alienate,
commute, pledge or encumber any benefits to which he is or may
become entitled to under the Plan, nor may the same be subject to
attachment or garnishment by any creditor of a
Participant.
8.10
Tax Withholding : Such sum may be withheld from the lump-sum
payment payable under the Plan for any federal, state or local
taxes required by law to be withheld with respect to such payment,
as the Company may reasonably estimate is necessary to cover any
taxes that may be assessed with regard to such payment.
8.11
Use and Form of Words : Words used herein in the masculine
gender shall be construed as also used in the feminine gender where
they would so apply, and vice versa. Words used in the singular
form shall be construed as also used in the plural form where they
would so apply, and vice versa.
8.12
Effect on Other Plans : Amounts accrued or paid under this
Plan shall not be considered compensation for the purposes of the
Company’s other employee benefit plans. All amounts paid
under this Plan will be a reduction of benefits calculated and
payable under the SERP.
8.13
Applicable Law : This Plan shall be governed and construed
in accordance with the laws of the State of Texas.
8.14
Scope : This Plan is intended only to remedy Pension Plan
benefit reductions caused by the operation of Sections 415 and/or
401(a)(17) of the Code and not reductions for
any other reason.
8.15
Plan Termination : No further benefits may be earned by a
Participant under this Plan after the termination of the Pension
Plan.
8.16
409A Compliance . It is intended that the provisions of this
Plan satisfy the requirements of Section 409A and that the Plan be
operated in a manner consistent with such requirements to the
extent applicable. Therefore, the Administrative Committee may make
adjustments to the Plan and may construe the provisions of the Plan
in accordance with the requirements of Section 409A.
8.17
Specified Employees . If a Participant is a “specified
employee,” as such term is defined in Section 409A and
determined as described below in this Section 8.17, any payments
payable as a result of the Participant’s Termination of
Employment (other than death) shall not be payable before the
earlier of (i) the date that is six months after the
Participant’s Termination of Employment, (ii) the date of the
Participant’s death, or (iii) the date that otherwise
complies with the requirements of Section 409A. A Participant shall
be a “specified employee” for the twelve-month period
beginning on April 1 of a year if the Participant is a “key
employee” as defined in Section 416(i) of the Internal
Revenue Code (without regard to Section 416(i)(5)) as of December
31 of the preceding year or using such dates as designated by the
Administrative
Committee in
accordance with Section 409A and in a manner that is consistent
with respect to all of the Company’s nonqualified deferred
compensation plans. For purposes of determining the identity of
specified employees, the Administrative Committee may establish
procedures as it deems appropriate in accordance with Section
409A.
IN
WITNESS WHEREOF, this Plan, as amended and restated, has been
executed as of the 31 day of December, 2008, but effective as of
January 1, 2009.
TRANSOCEAN
LTD.
By:
_/s/ Cheryl D. Richard_____________________
Name:
__Cheryl D. Richard____________________
Title:
___Senior Vice President, Human Resources and
IPS__
APPENDIX
A
LEGACY
GLOBALSANTAFE PLAN
The
Legacy GlobalSantaFe Plan is attached hereto solely for purposes of
calculating a Participant’s Legacy Plan Benefit pursuant to
Article VI. For purposes of calculating the Legacy Plan Benefit, a
Participant will only be entitled to service under the Legacy
GlobalSantaFe Plan through the earlier of (i) the
Participant’s latest date of participation under the Plan or
(ii) December 31, 2008. However, a Participant’s Legacy Plan
Benefit shall include compensation earned while the Participant is
participating in the Plan.
APPENDIX
A
GLOBALSANTAFE
PENSION
EQUALIZATION PLAN
AS AMENDED AND
RESTATED
EFFECTIVE
NOVEMBER 27, 2007
APPENDIX
A
GLOBALSANTAFE
PENSION
EQUALIZATION PLAN
AS AMENDED AND
RESTATED
EFFECTIVE
NOVEMBER 27, 2007
GLOBALSANTAFE
PENSION
EQUALIZATION PLAN
WHEREAS
,
GlobalSantaFe Corporate Services Inc. (the “Company”)
adopted and maintains the GlobalSantaFe Pension Equalization Plan,
as amended effective July 21, 2007 and as amended and restated
effective January 1, 2008 (the “Plan”), for the benefit
of its employees and the employees of its subsidiaries to aid such
employees in making more adequate provision for their retirement;
and
WHEREAS
,
the Company previously adopted the amended and restated plan
effective as f January 1, 2008 to comply with the provisions of
Section 409A of the Internal Revenue Code, as amended
(“Section 409A”) and to preserve the material terms of
the Plan as in effect on December 31, 2004 in order that such plan
qualify as a grandfathered plan for purposes of Section 409A;
and
WHEREAS
,
the Company desires to make certain changes to the Plan in
accordance with the Agreement and Plan of Merger by and among the
GlobalSantaFe Corporation, Transocean Inc. and Transocean
Worldwide, Inc., dated as of July 21, 2007 with the understanding
that such changes will constitute a “material
modification” for purposes of Section 409A.
NOW
THEREFORE , the Plan is
hereby amended and restated to read as follows, effective as of
November 27, 2007:
ARTICLE
I
PURPOSE
1.1
Purpose of the Plan : The purpose of this Plan is generally
to provide the amount of the benefit that would otherwise be paid
under the Pension Plan, as in effect on the applicable date, but
which cannot be paid under these plans on account of (a) the
limitations of Section 401(a)(17) of the Internal Revenue Code of
1986, as amended (the “Code”), which limits the annual
compensation that may be taken into account in computing benefits
under the Pension Plan to $225,000 (or such other dollar amount as
may be prescribed by the Secretary of the Treasury or his or her
delegate), and (b) Section 415 of the Code, which limits the
benefits and contributions under qualified plans.
1.2
ERISA Status : Program A of the Plan, detailed in Article
III below, is intended to qualify for the exemptions provided under
Title I of the Employee Retirement Income Security Act of 1924, as
amended from time to time (“ERISA”), for plans that are
not qualified under Code Section 401(a) and that are maintained
primarily to provide deferred compensation for a select group of
management or highly compensated employees. Program B of the Plan,
set forth in Article IV below, is intended to qualify for the
exemptions provided under Title I of ERISA for plans that are
excess benefit plans as defined in Section 3(36) of
ERISA.
APPENDIX
A
GLOBALSANTAFE
PENSION
EQUALIZATION PLAN
AS AMENDED AND
RESTATED
EFFECTIVE
NOVEMBER 27, 2007
ARTICLE
II
DEFINITIONS
Except as
otherwise indicated, for purposes of the Plan, the terms listed
below shall be defined as follows:
Additional
Service Period : The term
“Additional Service Period” means, with respect to any
Participant who received a severance payment, whether in the form
of salary and/or bonus continuation payments or in a lump sum or
sums, the salary and/or bonus continuation period or, in the case
of a lump sum or sums, the period with respect to which the lump
sum or sums are deemed paid pursuant to the definitions of
“Basic Earnings” and “Bonus” contained in
this Plan.
Administrative
Committee : The committee
established by the Board to administer the Plan pursuant to Section
7.1.
Affiliate
:
The term “Affiliate” shall have the identical meaning
of that term as set out in the Pension Plan.
Applicable
Pension Plan : The term
“Applicable Pension Plan” means the Pension Plan as in
effect on the date of Participant’s Termination of
Employment.
Basic
Earnings : The term
“Basic Earnings” shall have the identical meaning of
that term as set forth in the Pension Plan, only without regard to
the limitations imposed by Section 401(a)(17) of the Code; provided
that “Basic Earnings” shall include severance payments
based on a multiple or any percentage of salary, whether made as
salary continuation payments or in a lump sum or sums. In the event
such a severance payment is paid in a lump sum or sums, the salary
amount shall be deemed to accrue over the period of time it would
normally have been paid had the Participant’s salary at the
time of termination continued until the severance payments were
exhausted.
Board
:
The Board of Directors of the Company.
Bonus
:
The term “Bonus” shall have the identical meaning of
that term as set out in the Pension Plan, only without regard to
the limitations imposed by Section 401(a)(17) of the Code; provided
that the term “Bonus” shall include severance payments
based on a multiple or any percentage of a bonus or deemed bonus,
whether made as bonus continuation payments or in a lump sum or
sums. In the event such a severance payment is paid in a lump sum
or sums, the payment shall be included and shall be deemed paid as
follows: (a) any payment based on a multiple of a bonus or deemed
bonus shall be divided by the multiplier and each fraction thereof
shall constitute a single annual “Bonus,” which shall
be deemed paid on the customary annual bonus date (as determined by
the Administrative Committee) over the number of years represented
by the multiplier and (b) any payment that is 100% of, or less
than, the bonus or deemed bonus shall be
APPENDIX
A
GLOBALSANTAFE
PENSION
EQUALIZATION PLAN
AS AMENDED AND
RESTATED
EFFECTIVE
NOVEMBER 27, 2007
deemed to be
paid on the customary bonus date next following the date of the
Participant’s termination of employment.
Code
:
The Internal Revenue Code of 1986, as amended from time to
time.
Company
:
GlobalSantaFe Corporate Services Inc.
Effective
Date : November 27,
2007.
ERISA
:
The Employee Retirement Income Security Act of 1974, as amended
from time to time.
Lump-Sum
Equivalent : With respect
to any benefit hereunder, a lump-sum payment equal in value at date
of determination to such benefit when determined actuarially, based
upon the mortality table and interest rate used in the Pension Plan
in effect as of Participant’s Termination of Employment. In
the event that age is increased by a salary and/or bonus
continuation period or an Additional Service Period (“imputed
years”), the lump sum payment will be discounted by the
number of imputed years from the date of determination to the date
of payment using interest only at the interest rate used in the
Pension Plan in effect as of Participant’s Termination of
Employment. For purposes of Sections 3.3(f), 4.3(f) and 5.1(c)
herein, the date of determination is the day after the end of the
Additional Service Period.
Participant
:
An employee of the Company or its Affiliate who qualifies for
participation in the Plan under Sections 3.2 and/or 4.2 of the
Plan.
Pension
Plan : The
GlobalSantaFe Retirement Plan for Employees, as amended and
restated effective May 1, 2003, and as thereafter may be amended
from time to time.
Plan
:
The GlobalSantaFe Pension Equalization Plan as amended and restated
effective November 27, 2007 and as thereafter amended from time to
time.
Plan
Administrator : The
Administrative Committee.
Section
409A : Section 409A
of the Code and applicable U.S. Treasury authorities.
Termination of
Employment : The term
“Termination of Employment” means “separation
from service”, as defined in Section 1.409A-1(h) of the U.S.
Treasury regulations, with the Company or an Affiliate for any
reason other than a transfer between Employers.
Window Benefit
Participant : A Participant
who is eligible for a window benefit under Section 5.7 of the
Applicable Pension Plan.
Window
Excluded Participant : A Participant
who would have been eligible for a window benefit under Section 5.7
of the Applicable Pension Plan had Participant not been
specifically excluded pursuant to Appendix A of the Applicable
Pension Plan.
APPENDIX
A
GLOBALSANTAFE
PENSION
EQUALIZATION PLAN
AS AMENDED AND
RESTATED
EFFECTIVE
NOVEMBER 27, 2007
ARTICLE
III
PROGRAM A:
RESTORATION OF BENEFITS REDUCED BY SECTION
401(A)(17)
3.1
Purpose : Section 401(a)(17) of the Code limits the amount
of compensation that may be taken into account under a qualified
plan for any year to $225,000 (or such other dollar amount as may
be prescribed by the Secretary of the Treasury or his or her
delegate). The
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