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        Brian F. Maxted has been our Chief Executive Officer since January 2011. For Mr. Maxted's biographical information, please see "Proposal 1—Election of Directors—Directors" above.
        W. Greg Dunlevy is one of the founding partners of Kosmos and has served as our or KEH's Executive Vice President and Chief Financial Officer since 2003. Prior to co-founding Kosmos in late 2003, Mr. Dunlevy was the Chief Executive Officer of Moncrief Oil International Inc. from 2002 to 2003 and was also previously the Senior Vice President, Chief Financial Officer and treasurer of Triton Energy Limited. Mr. Dunlevy has extensive experience and expertise in oil and gas finance, planning, treasury and banking and has worked with major and mid-cap U.S. independents for more than 25 years. Mr. Dunlevy holds a Bachelor of Science from the College of William and Mary and a Masters of Business Administration from Harvard Business School.
        Paul Dailly is one of the founding partners of Kosmos and has served as our Senior Vice President and Chief Geoscientist since 2012 and as our or KEH's Senior Vice President, Exploration from 2003 to 2012. Before joining Kosmos in 2003, Mr. Dailly had 15 years of experience as an exploration geologist. Mr. Dailly worked for British Petroleum plc from 1989 to 1994 and Triton Energy Limited from 1994 to 2001. While at Triton, Mr. Dailly was the geologist and technical team leader responsible for exploration and appraisal of that company's eight oil field discoveries offshore Equatorial Guinea. Mr. Dailly holds a Bachelor of Science (Honors) from Edinburgh University and a Doctor of Philosophy in Geology from the University of Oxford.
        Jason E. Doughty has served as our Senior Vice President, General Counsel since October 2012 and as our General Counsel since September 2011. Mr. Doughty spent more than 11 years with ConocoPhillips in various leadership roles, including serving as Deputy General Counsel, Americas Exploration and Production. During his tenure with ConocoPhillips, he was responsible for the company's commercial litigation and international arbitration efforts, the Lower 48 and Latin America E&P legal group and the Indonesia legal group. Previously, Mr. Doughty was an attorney with ExxonMobil in Houston and a commercial litigation attorney in private practice in Santa Fe, New Mexico. He earned a Juris Doctor from the University of Houston Law Center, a Master's Degree in Business Administration from the University of Texas at Austin and a Bachelor of Science in Finance from Louisiana Tech University. He is a member of the State Bar of Texas.
        Marvin M. Garrett has served as our Senior Vice President, Operations and Development since 2012 and as our or KEH's Senior Vice President, Production and Operations between 2010 and 2012, prior to which he served as KEH's Senior Vice President of Operations and Development from January 2006. Before joining Kosmos in January 2006, Mr. Garrett was the Vice President of Operations for Triton where he led the development of the deepwater Ceiba oil field discovery offshore Equatorial Guinea and managed that company's drilling program in Argentina, China, Ecuador, Greece, Guatemala and Italy. Mr. Garrett has nearly three decades of experience managing oil and gas drilling,
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production and development activities worldwide. Mr. Garrett holds a Bachelor of Science degree in Petroleum Engineering from the University of Louisiana—Lafayette.
        Tyner M. Gaston has been our Senior Vice President, Global Human Resources since joining Kosmos in March 2012. Before joining Kosmos, Mr. Gaston served as Senior Vice President and Chief Operations Officer, Human Resources for the outsourcing division at Xerox Corporation, with responsibility for Human Resources operations in 39 countries. Prior to that, Mr. Gaston served as Vice President, Human Resources, and Vice President, Corporate Quality Improvement, for Haggar Clothing Company. Mr. Gaston holds a Bachelor of Science in Business Administration from Virginia Commonwealth University.
        Eric J. Haas has served as our Senior Vice President, Production and Technical Services, since January 2013, having joined Kosmos in February 2008 to lead a team in the appraisal and development of the Jubilee Field in Ghana. Prior to joining Kosmos, he spent nearly 25 years at Hess Corporation, a global integrated energy company involved in exploring and developing crude oil and natural gas, manufacturing refined petroleum products and marketing and trading refined petroleum products, natural gas and electricity where he held various positions and was responsible for numerous production and development projects in the Gulf of Mexico, Northwest Europe, Russia, North Africa and West Africa. Mr. Haas holds a Bachelor of Science in Petroleum Engineering from New Mexico Institute of Mining and Technology.
        William S. Hayes has served as our Senior Vice President, Legal and External Affairs since 2011. Prior to holding his current position, Mr. Hayes served as General Counsel since 2007. Prior to joining Kosmos, Mr. Hayes was Senior Vice President and General Counsel for Urals Energy PLC in 2007 and Cardinal Resources PLC from 2004 to 2007. For over 30 years, Mr. Hayes has worked for or represented public and private, major and independent exploration and production companies in approximately 30 countries. Mr. Hayes holds a Juris Doctor from St. Mary's University School of Law and a Bachelor of Journalism from the University of Texas. He is a member of the Board of Directors of the Business Council for International Understanding and is a member of the Advisory Board of a public-private partnership, Partners for a New Beginning—North Africa Partnership for Economic Opportunity. Mr. Hayes is a member of the State Bar of Texas, the International Bar Association and the Association of International Petroleum Negotiators.
        Darrell L. McKenna has been our Chief Operating Officer since January 2012. Mr. McKenna joined the Company from Hess Corporation, a global integrated energy company involved in exploring and developing crude oil and natural gas, manufacturing refined petroleum products and marketing and trading refined petroleum products, natural gas and electricity. Mr. McKenna held the following positions at Hess Corporation: General Manager of Amerada Hess Corp. Equatorial Guinea from 2004 to 2006; Vice President, Africa Business Unit from 2006 to 2008; Vice President, E&P Technology from 2008 to 2009; Vice President, Global Drilling and Completions from 2009 to 2010; and President of Hess Australia from 2010 to 2012. Mr. McKenna holds a Bachelor of Science (with Honors) in Petroleum Engineering from the Montana School of Mineral Science and Technology.
        Paul M. Nobel has served as our Senior Vice President and Chief Accounting Officer since July 2012. From June 2006 to July 2012, Mr. Nobel held the position of Senior Vice President, Chief Accounting Officer of World Fuel Services Corporation, a multi-billion dollar global fuel logistics company, and also concurrently held multiple other financial leadership positions during that time at World Fuel Services, including Senior Vice President, Finance—EMEA, Senior Vice President, Finance, of the company's land segment, Senior Vice President, Audit and Business Controls, Senior Vice President—Treasurer and Senior Vice President—Corporate Finance. From July 2005 to June 2006, Mr. Nobel held the position of Senior Vice President, Corporate Finance of World Fuel Services Corporation. He earned a Bachelor of Science degree from Florida State University and is a Certified Public Accountant.
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EXECUTIVE COMPENSATION




Compensation Discussion and Analysis ("CD&A")
        This CD&A describes our executive compensation philosophy, process and objectives and the elements of our 2012 compensation program for our Chief Executive Officer, our Chief Financial Officer and our three other most highly compensated executive officers (referred to as our "named executive officers"), and gives the context for understanding and evaluating the compensation information contained in the tables and related disclosures that follow. For 2012, our named executive officers were:


Brian F. Maxted, Chief Executive Officer;



W. Greg Dunlevy, Executive Vice President and Chief Financial Officer;



Tyner M. Gaston, Senior Vice President, Global Human Resources;



Darrell L. McKenna, Chief Operating Officer; and



Paul M. Nobel, Senior Vice President and Chief Accounting Officer.

Executive Summary
        In 2012, we continued to grow as a public company after undergoing a corporate reorganization and IPO in 2011 and enjoyed considerable success during this relatively early stage in our development. Below we have highlighted some of the key aspects of our results in 2012 and the compensation that we paid to our named executive officers to incentivize and reward performance in 2012 and future years.
    2012 Business Highlights
        In 2012, we delivered the following solid financial and operating performance:


We had six liftings of oil totaling 5.905 million barrels from the Jubilee field production resulting in revenues of nearly $668 million. Our average realized price per barrel was $113.12. Overall Jubilee production was enhanced to approximately 110,000 barrels of oil per day at the end of 2012, up from approximately 70,000 barrels of oil per day at the end of 2011.



We received approval for the Phase 1A plan of development of the Jubilee field, and production commenced in late 2012.



We secured a new $300 million revolving credit facility, with $260 million of commitments initially available to us and an additional $40 million of commitments becoming available if the lenders choose to increase their commitments or if commitments from new financial institutions are added. As a result, this allowed us to enhance our financial liquidity position by increasing our total available borrowings to over $600 million, which is in addition to our cash on hand of $515 million at the end of 2012.



New Ntomme and Enyenra well appraisals confirmed areal extensions of the Ntomme Field and Enyenra light oil field on the Deepwater Tano Block offshore Ghana ("DT Block"). A drill stem test successfully flowed oil from multiple zones in the Ntomme Field reservoir.



We submitted a declaration of commerciality and plan of development covering the Tweneboa, Enyenra and Ntomme discoveries (the "TEN PoD") on the DT Block. The TEN PoD plans for flexible and expandable development, with an initial base capacity of 80,000 barrels of oil per day. The final development concept is subject to approval by the government of Ghana.
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The Wawa-1 exploration well made a hydrocarbon discovery on the DT Block. Analysis of well results, including wireline logs, reservoir pressures and fluid samples, indicated that the well encountered gas-condensate and oil-bearing pay.



We entered into new petroleum contracts in Cameroon and Mauritania covering an aggregate area of approximately 6.6 million acres.



We completed a 4,925 square kilometer 3D seismic acquisition program which covered portions of the Essaouira Offshore Block and the Foum Assaka Block, both in the Agadir Basin offshore Morocco.



The Moroccan government issued a joint ministerial order approving our acquisition of an additional 18.75% participating interest in the Foum Assaka Offshore Block from Pathfinder, a wholly owned subsidiary of Fastnet, one of our block partners. Upon receipt of this order, we closed the acquisition of such additional participating interest with Pathfinder. We expect final governmental processes required to officially reflect the acquisition under Moroccan law to be completed in due course. After giving effect to the acquisition, our participating interest in the Foum Assaka Offshore Block is 56.25%.



We entered into an agreement to acquire an additional 37.5% participating interest in the Essaouira Offshore Block from Canamens Energy Morocco SARL, one of our block partners. Certain governmental approvals and processes are still required to be completed before this acquisition can be closed. After completing the acquisition, our participating interest in the Essaouira Offshore Block will be 75%.



We made an election under the Tarhazoute Reconnaissance Contract to enter into a petroleum contract. Negotiation of the petroleum contract and associated documents is currently ongoing. We anticipate we will be the operator of the license and hold a 75% participating interest.



We closed an agreement with Chevron Global Energy Inc. ("Chevron") under which Kosmos assigned half of its interest in Block 42 and Block 45, offshore Suriname, to Chevron. Each party now has a 50% participating interest in Block 42 and Block 45.



We completed a 3D seismic data acquisition program which covered approximately 3,900 square kilometers of portions of Block 42 and Block 45 offshore Suriname.
    Key Compensation Decisions in 2012
        Our compensation program in 2012 was designed to directly tie our named executive officers' pay to Company performance, thereby aligning the executives' interests with those of our shareholders. We believe that our compensation program effectively incentivized our executives in leading us to achieve the solid performance we experienced in 2012 and will continue to motivate the executives to position us for future growth and success. Our key compensation decisions in 2012 included:


Base Salary.  We did not provide our named executive officers with salary increases for 2013. We believe our named executive officers' current salaries reflect each executive's responsibilities and experience. As the only fixed component of our compensation program and a relatively small part of our named executive officers' total compensation, base salaries are increased primarily to align with changes in responsibilities, experience and competitive practice.



Annual Cash Bonus.  To incentivize our named executive officers and to acknowledge their and the Company's solid performance in 2012, we paid them discretionary cash bonuses in December 2012. Bonus payments were not tied to a specific formula but rather were based on a holistic assessment of Company and individual performance.
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Equity Incentive Awards.  In connection with their hiring in 2012, our new named executive officers—Messrs. Gaston, McKenna and Nobel—received new hire equity grants under our long-term incentive plan (the "LTIP"). Messrs. Gaston and McKenna received new hire equity grants consisting of service-vesting restricted shares (which we refer to as "service shares") and performance-based restricted shares (which we refer to as "performance shares") and Mr. Nobel received a new hire equity grant consisting of service-vesting restricted share units (which we refer to as "service units") and performance-vesting restricted share units (which we refer to as "performance units"). In addition, in June 2012, Messrs. Gaston and McKenna received equity grants as part of our annual equity grant process consisting of service shares and performance units (Mr. Nobel did not join Kosmos until July 2012 and, therefore, did not receive an annual equity grant in June 2012). Messrs. Maxted and Dunlevy—two of our founding partners—did not receive any equity awards in 2012 due to their significant equity stake in our Company pre-IPO and the value of the equity grants they received in connection with our IPO. We believe that equity awards (both new and outstanding) serve to retain and incentivize our named executive officers to work toward our continued growth and success. The awards also align the interests of our named executive officers (and other employees) with those of our shareholders, as the ultimate value received depends on the share price on the vesting date and, in the case of the performance shares/units, the level of attainment of the specified total shareholder return ("TSR") goal.

Overview
        As a recently public oil and gas exploration and production company, we are focused on maximizing production, developing our discoveries and acquiring, exploring and appraising existing and new opportunities, including identifying, capturing and testing additional high-potential prospects to grow reserves and production. Our named executive officers have significant industry experience and have been instrumental in achieving these goals. We have designed our compensation program to attract and retain these highly experienced individuals, who have competing opportunities at more established companies, as well as to motivate and reward these individuals for their continued efforts to successfully deliver on our business plan. The three principal elements of our executive compensation program have continuously consisted of base salaries, annual cash bonuses and long-term equity incentive awards, with our approach to each of these elements evolving with our stage of development.


Pre-IPO.  Prior to our IPO, we were a private partnership. To retain, incentivize and reward our named executive officers and other employees, and to maintain a strong ownership culture, in addition to paying salaries and annual cash bonuses, we granted them profit units representing targeted profit interests in KEH, our partnership predecessor. These profit units comprised a significant portion of our named executive officers' total compensation.



At IPO.  In connection with our IPO, vested profit units were exchanged for vested common shares and unvested profit units were exchanged for service-vesting restricted shares (which we refer to as "exchange shares"). In addition, our named executive officers and other employees received grants of service and performance shares for overseeing our IPO, ensuring a smooth transition between our status as a private partnership and that of a public company and developing existing and identifying new reserve and production opportunities.



Post-IPO (2012).  In 2012, our named executive officers were instrumental in and were rewarded for overseeing our continued growth and development post-IPO and developing existing and identifying new reserve and production opportunities. Equity awards, which are designed to ensure a competitive, long-term incentive that directly aligns the interests of our named executive officers with those of our shareholders, continued to represent the most significant portion of our named executive officers' compensation. As noted above, Messrs. Maxted and Dunlevy did not receive any equity awards in 2012. Nevertheless, during 2012 they continued to
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vest in the equity awards they received before and in connection with our IPO, and, therefore, our equity constituted a significant incentive for their performance during 2012 (for the values of our named executive officers' equity awards that vested in 2012, see "2012 Compensation—Option Exercises and Stock Vested During 2012" below).

Compensation Program Objectives and Methodology
        The objectives of our executive officer compensation program are as follows:


Attract, retain and motivate talented and experienced executives in the highly competitive oil and gas industry;



Reward individual and corporate performance;



Align the interests of our executives and shareholders by providing a substantial portion of the executives' compensation in the form of long-term equity-based awards granted under the LTIP; and



Motivate our executives to manage our business to meet our long-term objectives and create and increase shareholder value and reward the executives when shareholder value increases.

Elements of Our Executive Compensation Program
        As noted above, since our inception, our executive compensation program has consisted of base salaries, annual cash bonuses and long-term equity incentive compensation. Our named executive officers are not entitled to any supplemental executive retirement benefits or "golden parachute" tax gross-ups. We expect that base salaries, annual cash bonuses and long-term equity incentive compensation will remain the principal elements of our executive compensation program going forward, although the relative proportions of each element, and the specific plan and award designs, will continue to evolve as we become a more established public company. For instance, for 2013, we expect that the amount of the aggregate bonus pool for all of our employees, including our named executive officers, will be tied more formulaically than in the past to Company performance. Each element of our 2012 executive compensation program is described in more detail as follows:

 

 

 

Element

 

Objective and Basis

Base salary

 



Competitive for each role, taking into account experience and level of responsibility in companies of similar size, complexity and stage of development.                        

 

 



A basic fixed component, which comprises a relatively modest portion of overall compensation.                        

 

 



Reviewed annually for possible adjustment by the Compensation Committee with input from our Chief Executive Officer (except for his salary), taking into account level of responsibility and experience and competitive practice.                        

Annual cash bonus

 



Reward individual and company performance for the year.

 

 



Bonus amount (including whether any bonus is paid) is discretionary and takes into account Company performance as well as factors related to each executive officer's responsibilities, including financial and operating performance, significant strategic initiatives, resolution of unforeseen events and organizational leadership.
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