EXHIBIT 10-(17)
[LOGO OF TRANSOCEAN APPEARS HERE] TRANSOCEAN OFFSHORE INC.
0 XXXXXXXX XXXXX (77046)
XXXX XXXXXX XXX 0000
XXXXXXX, XXXXX 00000-0000
February 18, 1997
Xxxxxx Xxxx
Xxxxxxxxxxxxxx 0-0
Xxxxxxxx, Xxxxxx
Re: Severance Agreement
Dear Reidar:
You have indicated a desire to leave Transocean Offshore Inc. ("Transocean") in
order to pursue other business opportunities. Transocean is appreciative of
your dedicated service to the company and wishes to arrange for a smooth
transition as well as to provide a business opportunity to you that can
hopefully be beneficial to both parties. Accordingly, you and Transocean agree
as follows:
1. You agree to remain as Chief Executive Officer of Transocean ASA until the
earlier of (a) a replacement being installed in Tananger or (b) July 1, 1997.
2. You agree to remain on the Board of Directors of Transocean until your
employment with Transocean is terminated under either paragraphs 5 or 7 below.
At that time, you will resign from the board.
3. You agree to use your good faith efforts to assist and support Transocean
in restructuring Transocean ASA, in its ongoing business activities and in the
resolution of the dispute with Statoil.
4. You agree to lead the efforts to spin off in a public offering or to
otherwise sell or dispose of designated assets of TEC and TPT. In the event
that there is a public offering such that there is a new listed company in
Norway, you agree to be the Chairman and Chief Executive of this new company
("Spinco").
5. Transocean agrees that your salary and benefits will remain as present
until your employment with Transocean is terminated either (a) when Spinco goes
public or (b) the designated assets are sold.
6. (a) If you leave Transocean to go to Spinco, Transocean agrees to pay you
a lump sum amount of $500,000. In addition, Transocean confirms that it will
honor the arrangements in your Early Retirement Agreement and Supplemental
Pension Agreement i.e. you will receive (i) the accrued value of the insurance
policies under the Early Retirement Agreement by the transfer of these policies
to you and (ii) the company will stop annual premium payments as to the
insurance under the Supplemental Pension Agreement and you will get the value of
that insurance at the time it would be paid under the Supplemental Pension
Agreement based upon the premiums paid to that date. Transocean further agrees
that if you leave because Spinco is sold in a public offering, Transocean will
reserve 2% of the stock in the initial offering for you and your designated
management team.
(b) If you leave Transocean when the designated assets are sold, then
Transocean will pay you a lump sum amount equal to 36 months of your current
salary. In addition, Transocean confirms that it will honor the arrangements
under the Early Retirement Agreement and Supplemental Pension Agreement as set
forth above.
7. In the event that by December 31, 1997, (a) Spinco is successfully formed
and sold in a public offering or (b) the assets are sold and in either event you
thus leave Transocean, then the compensation set forth above shall be in lieu of
and in full satisfaction of the company's responsibilities as to the
compensation you would otherwise be entitled to under your Employment Agreement
as supplemented on May 31, 1996. In the event that the spinoff or sale has not
occurred by December 31, 1997, then you will leave Transocean as of
December 31, 1997 and, as full satisfaction of the company's responsibilities,
you will be entitled to the compensation set forth in the May 1996 Supplement to
your Employment Agreement (i.e. 36 months of salary plus the insurance benefits
in Section 6); provided, however, that Transocean agrees that in that event your
future income or salary shall not be deducted from the payment to be made under
2.1 of this supplement to the Employment Agreement.
Agreed and accepted at Houston, Texas on this 20th day of February 1997.
TRANSOCEAN OFFSHORE INC.
/s/ J. XXXXXXX XXXXXXX
____________________________________
J. Xxxxxxx Xxxxxxx, Chairman and CEO
/s/ XXXXXX XXXX
____________________________________
Xxxxxx Xxxx
